China Evergrande Group: Unable to Pay Principal and Interest on “20 Evergrande 04” Bonds as Agreed

On September 25, China Evergrande Group Limited announced that China Evergrande Group Limited’s 2020 corporate bonds issued to professional investors (first tranche) (bond abbreviation 20 Evergrande 04; bond code: 149247.SZ) should have paid the principal and related interest of this bond on September 25, 2023 (September 23 is a non-trading day, deferred to the next trading day).

As of September 25, 2023, China Evergrande Group Limited has been unable to pay the above-mentioned bond principal and interest as agreed.

Evergrande stated that it will continue to actively negotiate with bondholders based on the premise of “not escaping debt,” aiming to reach a solution recognized by bondholders as soon as possible, jointly resolve debt risks with all parties’ efforts, and legally protect the legitimate rights and interests of creditors.

On the evening of September 24, China Evergrande (03333.HK) disclosed updated information on its overseas debt restructuring.

China Evergrande stated in the announcement that the new bonds to be issued under the proposed restructuring must comply with the “Administrative Measures for the Issuance of Securities and Listing by Domestic Enterprises Overseas” issued by the China Securities Regulatory Commission and the “Measures for the Examination, Registration, and Management of Medium and Long-term Foreign Debt of Enterprises” issued by the National Development and Reform Commission, depending on the applicable circumstances. The company must prove its compliance with the relevant regulations.

However, given that China Evergrande Group Limited (the company’s major subsidiary) is currently under investigation, China Evergrande cannot meet the eligibility for the issuance of new bonds at present.

Regarding significant litigation cases, as of the end of July 2023, the total number of pending litigation cases involving China Evergrande with amounts exceeding 300 million yuan reached 1,931, with a cumulative amount of approximately 437.743 billion yuan.

In terms of overdue matured debt, as of the end of July 2023, China Evergrande was involved in cumulative overdue matured debt of approximately 277.501 billion yuan. In addition, as of the end of July 2023, China Evergrande had cumulative overdue commercial papers of approximately 207.5 billion yuan.

In terms of the disposal of real estate project assets, as of the end of July 2023, China Evergrande had completed the transfer of a total of 70 real estate projects through methods such as equity transfer, land and ongoing construction project transfer, trust, and holding on behalf of others.

During July 2023, China Evergrande added 164 pieces of executed information, with a total added executed amount of approximately 12.647 billion yuan. In addition, China Evergrande, as the executed person, added 55 equity interests of subsidiary and affiliated companies that were frozen, involving a total amount of approximately 44.684 billion yuan.