HONG KONG (AFP) – A petition to wind up debt-hit Country Garden has been filed in a Hong Kong court, the company said yesterday, the latest property developer to face possible liquidation.
Country Garden has racked up more than USD190 billion in debt, becoming a symbol of an industry-wide crisis that has fuelled fears of a spillover into the wider economy.
The petition, filed by a lender demanding payback of approximately HKD1.6 billion (USD204 million), came weeks after Hong Kong’s High Court granted a similar petition against peer Evergrande, which is more than USD300 billion in debt, kickstarting its offshore assets liquidation and management replacement.
“The company will oppose the petition vigorously,” Country Garden said in its disclosure to the Hong Kong Exchange yesterday.
“The company intends to continue to proactively communicate and work with its offshore creditors on its restructuring plan, with the objective of announcing terms to the market as soon as practicable.”
Country Garden has incurred debts estimated in June at CNY1.36 trillion (USD191 billion).
The petitioner Ever Credit Limited is a licensed money lender subsidiary of Hong Kong-listed Kingboard Holdings.
Last October, Kingboard disclosed that Country Garden had failed to repay HKD1.598 billion to Ever Credit, from a loan of HKD1.88 billion.
The share price of Country Garden dropped by 11 per cent yesterday following the petition disclosure.
