Evergrande Chairman States 2023 is Critical for Home Delivery and Debt Repayment, According to Reuters

HONG KONG (Reuters) – This year is set to be a “crucial year” for China Evergrande Group as it seeks to fulfill home deliveries to buyers, according to company Chairman Hui Ka Yan in a New Year’s Day letter to employees. He expressed confidence that the company would be able to repay all its debts.

With over $300 billion in liabilities, the world’s most indebted property developer is currently undergoing a debt restructuring process and has faced difficulties in repaying its numerous creditors and suppliers while completing ongoing projects.

“I firmly believe that as long as the entire Evergrande team diligently focuses on tasks such as completing construction, restoring sales, and resuming operations, we will certainly ensure home deliveries… and settle all types of debt while mitigating risks,” Hui stated in his letter dated January 1.

The company resumed construction on all 732 projects nationwide in 2022, successfully delivering a total of 301,000 homes. These numbers mark an improvement compared to the 256,000 units delivered across 631 projects in the first 11 months of the year, as noted in a recent company filing.

Despite these efforts, the company acknowledged in its December filing that it still faced significant challenges due to its substantial liabilities. There remains considerable uncertainty regarding whether resources available for debt repayment would generate the anticipated value, leading to discrepancies between the group and its creditors over the conditions of the debt restructuring plan.

Evergrande aims to secure creditors’ approval for its debt restructuring proposals by the end of February.