Evergrande loses $2 bln in value as trade resumes; extends creditor voting

China Evergrande Group (3333.HK) lost as much as $2 billion, or 80% of its market value, on Monday after its shares resumed trading in a crucial step for the world’s most indebted property firm as it seeks to restructure its offshore debt.

Evergrande is at the centre of a crisis in China’s property sector that has seen a string of debt defaults since late 2021, and its stock has been suspended for 17 months.

The developer is in the process of getting approvals from creditors and the courts to implement the debt restructuring plan. The company said the voting record time will be extended to Sept 20, from Aug 23.

In a filing on Monday, Evergrande also said the scheme meetings with creditors will be adjourned to Sept 26 from Aug 28, as “it is crucial that all… creditors understand the process of the proposed restructuring and the terms”.

Evergrande needs approval from more than 75% of the holders of each debt class to approve the plan, which offers creditors with a basket of options to swap debt for new bonds and equity-linked instruments backed by its stocks and those of its Hong Kong-listed units.

Its Hong Kong listed shares plunged 79% to HK0.35 in the afternoon session, narrowing losses from 87% at the opening. Market capitalisation shrank to HK$4.6 billion ($586.38 million from HK$21.8 billion ($2.78 billion) from when it last traded.

The stock has been suspended since March 21, 2022, and resumed trading after the company said it had fulfilled all conditions by the Hong Kong Stock Exchange.

This report’s information was first seen on REUTERS; to read more, click this link.