Evergrande misses debt payment deadline as fears over firm’s collapse mount
Evergrande bondholders are yet to receive an interest payment which was due yesterday, indicating the indebted property developer is on the verge of collapse.
The firm was scheduled to make a $83.5m by midnight in New York on Thursday, or noon on Friday in Hong Kong. However, two people with direct knowledge of the matter said no payment had been received, according to the Financial Times.
The news comes as Chinese authorities reportedly told local governments to brace themselves for the ramifications if Evergrande folds. The Wall Street Journal first reported the news.
Evergrande has another bond payment scheduled next week.
Evergrande is estimated to have $305bn in liabilities, caused by the company financing its rapid expansion across China through heavy borrowing.
It claims to have built 12m homes. It has extended into other business lines beyond real estate, including setting up an electric car business and owning Guangzhou football club.
Reports have also emerged suggesting Evergrande has stopped paying staff and suppliers in its electric vehicle unit.
Global markets have been rattled this week by rumours the property is nearing a collapse. Evergrande did fulfill one of its debt payments this week, which cooled markets.