At 9 o’clock on 4 October (GMT+8), the share trading of Evergrande and its property management unit were suspended by the Hong Kong exchange. Shortly after, this most-indebted property company is reportedly set to sell a half-stake in its property arm to Hopson, one of Evergrande’s Chinese rivals. This transaction is to be confirmed in the next few days and the company expects to raise lifesaving 20 billion RMB ($3.1 billion) from it to pay off its debt.
For months, Evergrande has been busy looking for investors to help it out in the recent debt crisis. However, the Chinese media stay positive and believe that a good sale of the company’s property arm is only a matter of time. As the second-largest property developer in China, Evergrande’s net profits reached over 2.6 billion RMB in 2020, representing an unusually high net profit growth rate of 184.7%.
Evergrande has also made some progress in selling its financial businesses. On 29 September, the company announced a 9.99 billion RMB ($1.5 billion) stake sale to Shengjing Bank, who requested that all the proceeds have to be used only to settle its “relevant financial liabilities”.