With more than $300 billion in liabilities, Evergrande exemplifies a crisis in China’s property sector, which makes up one-quarter of the world’s second-biggest economy.
Evergrande is fucked, but China will pull off a soft landing.
This is the best summary I could come up with:
HONG KONG, Nov 30 (Reuters) - China Evergrande Group (3333.HK), the world’s most indebted property developer, is seeking to avert a potentially imminent liquidation with a last-minute debt restructuring proposal, three people with direct knowledge of the matter said.
The defaulted company has until a Hong Kong court hearing on Monday to present a “concrete” revised debt restructuring proposal for offshore creditors, a judge said last month after its original plan had lapsed.
But the sources, who declined to be named as the talks are private, told Reuters that creditors were unlikely to accept Evergrande’s new proposal given low recovery prospects and growing concerns about the developer’s future.
Many creditors were dissatisfied with the October terms as they implied a major haircut on investments, sources have said, forcing Evergrande to scramble to sweeten the deal in what could be its final attempt to avoid liquidation.
The spectre of a messy collapse of Evergrande has been a major concern for global investors as the Chinese economy sputters, with property sales slowing and hundreds of thousands of unfinished homes across the country.
A lawyer for an ad hoc group of key offshore bondholders told the Hong Kong court last month that the restructuring plan could have a higher recovery rate for creditors than liquidation, in which they would get back less than 3%.
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