Renowned real estate company files for bankruptcy: massive debts, final liquidation has begun
The court in Guangzhou accepted the request of the local commercial bank to initiate bankruptcy and liquidation proceedings against the real estate arm of the Evergrande Group. The dramatic decision comes just one day after the company's founder was sentenced to life imprisonment.
The District Court in the city of Guangzhou, China, has officially accepted the request for the liquidation and bankruptcy of Hengda Real Estate Group, the real estate arm operating in mainland China of the renowned China Evergrande Group.
According to an official statement issued by the court, the request was filed by the Guangzhou Rural Commercial Bank against the backdrop of particularly severe insolvency. The bank clarified that the real estate company is unable to repay its debts and that the value of all its assets is insufficient to cover the financial liabilities it had.
This dramatic legal development comes just one day after the founder of the Evergrande Group — which was previously considered the real estate developer with the largest debts in the world — was sentenced to life imprisonment.
The harsh sentence was imposed on him five years after the collapse of the real estate giant shook the Chinese economy and the country's financial markets with great force, and now it appears that the liquidation proceedings of its central real estate operations arm are officially underway after a long period of uncertainty.
