Evergrande faces winding up petition in Hong Kong

A winding up petition has been filed against China Evergrande Group, the embattled Chinese property developer.

The petition is understood to have been brought by an investor in Evergrande’s Fangchebao business, an online real estate and car marketplace.

According to Reuters, Top Shine Global acquired 0.46% of Fangchebao for HK$750m in March 2021, when Evergrande sold 10% of the business to 17 investors for a total of $2.1bn. The move was a precursor to an initial public offering.

An unnamed Top Shine executive told Reuters that under the terms of the sale, if the IPO did not take place by 8 April this year, Evergrande would repurchase the shares at a 15% premium. The executive said Top Shine wanted Evergrande to honour the agreement.

Heavily-indebted Evergrande has been at risk of collapse since last autumn, when it first missed interest payments on international bonds. Its shares have been suspended by the Hong Kong stock exchange while the group - which has around $300bn in liabilities - attempts to restructure.

Evergrande has yet to comment on the petition, which was filed by Top Shine Global Limited of Intershore Consult (Samoa) Limited with the Hong Kong High Court on Friday. A hearing is due to be heard on 31 August.