Countdown to Crisis: Evergrande In Last Minute Talks with Major Creditors To Avert Liquidation

Crisis-hit Chinese property giant Evergrande Group EGRNF and its major foreign creditors are racing against the clock to strike a last-minute deal, aiming to avoid the liquidation of the company's offshore businesses scheduled for Monday. 

The negotiations follow the collapse of a previous restructuring attempt vetoed by Chinese regulators. The proposed deal involves Evergrande offering its creditors approximately 20% ownership of its parent company. 

Compliance with Chinese regulatory demands includes the stipulation that Evergrande refrains from issuing new debt as part of the restructuring efforts. 

Moreover, the Wall Street Journal notes the ongoing discussions with NWTN, a Dubai-based electric vehicle company, regarding potential investment in Evergrande's EV division. 

Earlier commitments from NWTN to infuse $500 million for a 28% stake in Evergrande Auto were halted temporarily when the previous restructuring plan disintegrated, the WSJ noted.

Ever since Evergrande defaulted in late 2021, the company has been central to China's escalating real estate crisis, grappling with substantial debts, unfinished home deliveries, and obligations to numerous suppliers. Chinese regulators had previously blocked an offshore debt restructuring and turnaround strategy, setting the stage for the ongoing negotiations.

Disclaimer: This content was partially produced with the help of AI tools and was reviewed and published by Benzinga editors.