This article is from the Australian Property Journal archive
POLICE in Shenzhen, southern China, have arrested several employees within Evergrande – the world’s most indebted property developer – wealth management business, as another major developer announced it would suspend repayment of offshore debt.
Among the staff detained was Du Liang, the general manager and legal representative of Evergrande’s wealth management division.
Police confirmed the arrests on social media.
“Recently, public security organs took criminal compulsory measures against Du and other suspected criminals at Evergrande Financial Wealth Management Co.,”
However police did not immediately comment on the investigation.
The arrests are expected to further complicate Evergrande’s plan to restructure after the group filed for bankruptcy protection in the United States and another major company Country Garden warned of a potential US$7.6 billion first-half loss.
Shares in the company fell 25% on the Hong Kong Stock Exchange following revelations of the arrest, which came after the company’s share price plummeted by 80% after it resumed trading three weeks ago following a 17-month suspension.
Trading in Evergrande was suspended in March 2022 after it failed to publish its 2021 financial results. Last month it published the results for 2021 and 2022, reporting a net loss of more than US$113 billion over the two-year period.
Meanwhile another state-backed developer, Sino-Ocean Group, announced last Friday it has suspended payment on all offshore debt, citing liquidity reasons.
Sino-Ocean is one of the top 20 real estate developers in China with over 800 projects across 80 cities from commercial offices, retail to apartments.
