Trading of China's Evergrande shares in Hong Kong suspended

The company owes billions to banks, customers and contractors and is facing a cash crunch.Its situation worsened after the government tightened limits on corporate debt levels.The company ran up billions of dollars in debt building apartment complexes, malls and office towers over the years.

Shares in troubled real estate developer China Evergrande Group and its property management unit Evergrande Property Services have been suspended from trading in Hong Kong.

The company's filings did not specify why the shares were stopped from trading.

Cailian, a Chinese online news service affiliated with the state-run newspaper Securities Times, said another developer, Hopson Development Holdings, was planning to acquire a majority share in Evergrande Property Services Group.

Trading in Hopson's shares also was suspended Monday in Hong Kong, "pending the release of announcement(s) in relation to a major transaction of the company under which the company agreed to acquire the shares of a company . . . listed on the stock exchange,'' it said in a filing.

Evergrande has been struggling to avoid defaulting on billions of dollars of debt. The company owes billions to banks, customers and contractors and is facing a cash crunch.

Its situation worsened after the government tightened limits on corporate debt levels.

The company ran up billions of dollars in debt building apartment complexes, malls and office towers over the years. In August 2020, the government ordered tightened controls on financing for China's 12 biggest developers, forcing them to reduce corporate debt loads that are seen as a threat to the economy.

Evergrande has been selling off various assets to try to alleviate the problem.

(This story has not been edited by Devdiscourse staff and is auto-generated from a syndicated feed.)