China Evergrande Group is edging closer to delisting from the Hong Kong stock exchange, as the trading suspension imposed following its court-ordered liquidation hit the 18-month mark.
The company’s shares have been suspended from trading since January 29, 2024 – the same day a Hong Kong court ordered its liquidation after it failed to present a viable restructuring plan. Under the exchange’s rules, a company that remains suspended for 18 consecutive months is subject to delisting.
Evergrande, founded by Hui Ka-yan in 1996 and listed in Hong Kong in 2009, was a poster child of China’s property boom. The company aggressively diversified into sectors ranging from bottled water to electric vehicles and football clubs to theme parks, amassing more than US$300 billion in liabilities at its peak.
Its financial troubles came to the fore in 2021, after Beijing rolled out the “three red lines” policy to rein in overleveraged developers and cool down the housing market.
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A vanishing fairyland dream: how China Evergrande rose, then crashed
A vanishing fairyland dream: how China Evergrande rose, then crashed
The move later triggered a cash crunch that led to widespread stoppages in construction, missed payments and a sharp drop in investor confidence. The cash-strapped developer defaulted on its offshore bonds in late 2021, sparking global concerns about contagion from China’s housing downturn.
