Bankruptcy proceeding against Evergrande unit to proceed, liquidators say

A court in the southeastern Chinese city accepted a bankruptcy liquidation application filed against Guangzhou Kailong Real Estate, an indirect wholly owned subsidiary of the world’s most indebted developer, on August 9, the liquidators of Evergrande said in the filing on Monday.

The intermediate court of Guangzhou will convene a meeting of the first creditors of Guangzhou Kailong on November 14. The “creditors of Guangzhou Kailong are requested to declare their claims to Guangzhou Kailong’s bankruptcy administrator” before November 7, the filing said.

The liquidators gave no other details about the bankruptcy application, according to the disclosure.

Trading of Evergrande’s shares has been suspended since January 29, and the liquidators said that “in the absence of substantial new investment into the company, the liquidators do not currently see a path to a restructuring” that would enable the company to resume trading of its shares.

China’s Ministry of Finance and the Hong Kong Accounting and Financial Reporting Council are assisting each other in their separate investigations of PwC’s audit work for Evergrande, based on an agreement signed between the two regulators in 2019.

Evergrande has more than 1,200 projects at different stages of progress, ranging from near completion to under construction, according to its 2022 annual report.