China Evergrande , which is the world's most heavily indebted property developer and became the poster child for China's property crisis, on Thursday filed for protection from creditors in a U.S. bankruptcy court.

China Evergrande (3333.HK), which is the world’s most heavily indebted property developer and became the poster child for China’s property crisis, on Thursday filed for protection from creditors in a U.S. bankruptcy court.

The company sought protection under Chapter 15 of the U.S. bankruptcy code, which shields non-U.S. companies that are undergoing restructurings from creditors that hope to sue them or tie up assets in the United States.

An affiliate, Tianji Holdings, also sought Chapter 15 protection on Thursday in Manhattan bankruptcy court.

A lawyer for Evergrande did not immediately respond to requests for comment.

Evergrande’s filing comes amid growing fears that problems in China’s property sector could spread to other parts of the country’s economy as growth slows.

Since the sector’s debt crisis unfolded in mid-2021, companies accounting for 40% of Chinese home sales have defaulted.

  • Mojojojo1993@lemmy.worldEnglish
    172·
    1 year ago

    You mean when China and other countries have been fudging the numbers on their supposed GDP.

    China should be fucked. It’s biggest industry’s is house building and it’s just been building fake cities to keep up with this apparent industry. It’s building for the sake of numbers going up in a spreadsheet.

    If Chinas numbers stop going up maybe other countries numbers also won’t go up.

    Why won’t anyone think of the shareholders. Someone please do something. All numbers must go up at all times.

  • AttackBunny@kbin.social
    2·
    1 year ago

    Maybe I’m dumb, but if I go buy property in Mexico (for instance) and the government decides to take it, or I stop paying on it, or run out of money, I don’t get any protections for my money. I can’t file for bankruptcy and keep my money safe. I gambled and lost.

    Why do non American companies/people have the opportunity to file for bankruptcy as protection in a country they aren’t beholden to the rules of?

  • AutoTL;DR@lemmings.worldBEnglish
    21·
    1 year ago

    This is the best summary I could come up with:

    Evergrande’s filing comes amid growing fears that problems in China’s property sector could spread to other parts of the country’s economy as growth slows.

    The health of Country Garden (2007.HK), China’s largest privately run developer, is also worrying investors after the company missed some interest payments this month.

    Evergrande has said creditors may be able to vote this month on a restructuring, with possible approval by Hong Kong and British Virgin Islands courts in the first week of September.

    Last month, Evergrande posted a combined $81 billion loss for 2021 and 2022, prompting investor worries about the viability of a debt restructuring plan it proposed in March.

    On Monday, its electric-vehicle unit China Evergrande New Energy Vehicle Group (0708.HK) announced its own proposed restructuring.

    That plan called for a $2.7 billion debt-for-equity swap, and a nearly $500 million share sale that would give Dubai-based automaker NWTN (NWTN.O) a 27.5% stake.

    I’m a bot and I’m open source!