Ahead of the payment of another $ 47.5 million in interest, indebted real estate Evergrande warns the Hong Kong stock exchange that it will sell 1.75 billion in Shengjing Bank shares to Shenyang Shengjing Finance Investment Group. Shares in the private giant burdened with $ 300 billion in debt are handed over to a state-owned group, the move is minimal compared to debt, but signals the beginning of a creeping nationalization that has already emerged in more recent cases. Hong Kong rewards Evergrande stock (+ 10.86%) but Fitch cuts grade to C from CC, does not believe in the recovery of a Group that undermines the stability of the system. The central bank in fact injects another 15.5 billion dollars of liquidity to support credit.
The new deadline halter
In view of the umpteenth expiration of the debt and after having failed last week the 83.5 million one on 2 billion five-year bonds maturing in March 2022, Evergrande tries the paper of the sale of shares to the financial company of a local investee bank, Shengjing Bank Co.
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Approximately 1.75 billion shares or 19.93% of the bank will pass to Shenyang Shengjing Finance Investment Group, a state-owned company that carries out capital and asset management activities.
From now to the end of the year Evergrande has monthly interest payments but no corporate debt, we will talk about it next year if the largest indebted real developer in the world is still alive. But Fitch doesn’t believe in a happy outcome, and downgrades Evergrande’s rating to C from CC. The Hong Kong Stock Exchange, on the other hand, applauds with a jump of +10.86 in the stock.
The weight of links with local governments
The Hong Kong stock exchange rewards the move with a 10% jump in the stock, giving a minimum of respite on the deadline of 22 October, the date of the possible filing for bankruptcy.