Chinese real estate group Evergrande has paid off a arrears of interest of about 71.7 million euros just in time, Chinese state media report. As a result, Evergrande is not officially labeled a defaulter and the company does not have to be declared bankrupt. The real estate group is still struggling with a sky-high debt.
The part that has now been repaid was an interest debt on a foreign bond. It was supposed to be paid September 23. When that didn’t happen, a 30-day grace period started. The deadline for that was this weekend.
The problems are far from over. New deadlines are coming for further payments. Evergrande is therefore still facing a possible bankruptcy. The total debt of the company is more than 260 billion euros.
Evergrande is the second largest property developer in China. The company has grown so big by continuing to borrow. Not only with banks, but also with construction companies, the developer still has many unpaid bills.
Yesterday, Evergrande lost 12.5 percent in value on the Hong Kong stock exchange when it turned out that a planned takeover of a business unit did not go through. After the long-awaited interest payment, the stock rose again. Evergrande gained 3.5 percent and helped the Hong Kong stock market index to an interim gain of 0.1 percent.