Chinese court freezes $157 million in Evergrande assets

Chinese court freezes $157 million in Evergrande assets

A Chinese court has ordered the freezing of 640.4 million yuan ($101 million) in assets held by a subsidiary of China's Evergrande Group. The asset freeze is according to a filing by the contractor Shanghai Construction Group.

Shanghai Construction is a state-owned company that sued the Evergrande unit in the southwest city of Chengdu in December 2021. The company has proposed freezing Evergrande's assets due to late payment of construction costs, citing a Guangzhou Intermediate People's Court ruling that the assets to be frozen would include bank deposits and real estate.

Ummatimes - Separately, Shanghai Construction Group said last week in a local Guangzhou court it had frozen 361.5 million yuan in assets of a different Evergrande unit in the central province of Jiangsu for late payments.

Many suppliers and contractors have launched legal action against Evergrande for late payments. The company is now the world's largest debtor property developer with more than $300 billion in liabilities.

A growing number of construction and decoration companies are also writing off assets or issuing profit warnings because of debt problems at Evergrande. Meanwhile, this has an impact on other property developers, which weakens other property business units.

In order to better oversee and manage Evergrande's debt restructuring by the authorities, all lawsuits against developers across China have been handled centrally by the Guangzhou Intermediate People's Court since around August.

Meanwhile, Evergrande declined to comment on the lawsuit with the Shanghai Construction Group.

Company chairman Hui Ka Yan said at an internal meeting earlier this month the company wanted to aim to fully restore construction work across China by February. The effort recovered 93.2 percent at the end of last year, with a goal of delivering 600,000 apartments by 2022.

Hui Ka Yan added that the company needed to pay off its debts by fully recovering construction and sales activities and not by selling off assets at low prices.