This article originally appeared on JoeHoft.com and was republished with permission.
China real estate behemoth, Evergrande, is filing for bankruptcy.
The China economy is in trouble, like the rest of the world’s economies. The Evergrande failure has been in the works for some time now. Once one of the most prestigious firms in China, it’s now facing bankruptcy.
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The Boston Globe reported earlier today:
Evergrande, the heavily indebted Chinese property giant, filed for bankruptcy protection Thursday in New York, raising concerns about ripple effects as China faces slow economic growth and a sluggish real estate sector.
Evergrande is seeking protection from creditors under Chapter 15 of the US bankruptcy code, which applies to insolvency cases involving multiple countries, while it makes efforts to restructure its debt. The filing references upcoming talks happening in Hong Kong and the Cayman Islands. Creditors could vote on a restructuring this month.
On Friday afternoon, Evergrande clarified that it is pressing ahead with offshore debt restructuring and had not filed a bankruptcy petition, which is a formal declaration that a company cannot pay its debts. The Chapter 15 filing is a ‘’normal’’ part of offshore restructuring, it said in a filing to the Hong Kong Stock Exchange.
This was coming. Evergrande won’t be the last bankruptcy in China.
Source: The Gateway Pundit