China Evergrande secures extension on USD 260 million default

China Evergrande secures extension on USD 260 million default

China Evergrande Group has successfully secured an extension over a defaulted bond, REDD, the financial provider reported on Thursday. It gave some much-required respite and breather to the real estate developer. It came after the attempt to sell USD 2.6 billion stakes in its service property failed. 

Interestingly, the real-estate giant has secured an extension of more than three months to the bonds. So now, the bonds worth USD 260 million will mature after three months. Notably, they were issued by Jumbo Fortune Enterprise, a joint venture, and Evergrande guaranteed it beyond October 3. In addition, it agreed to offer extra collateral, citing bond’s holders, REDD reported. 

The extension news came into development when Evergrande stated on Wednesday that it scrapped the agreement to let off a 50.1 per cent stake to Hopson Development Holdings Limited. It happened because the petite rival failed to meet the prerequisite for making the general offer. 

However, both sides lamented acquisitions on each other for the setback. Hopson shrugged off by saying that there was no substance to whatever was against said against the deal not getting on the floors to Evergrande’s termination. The company said it was securing its interests. 

Reportedly, both conglomerates traded blames on each other. However, it is yet to be ascertained whose fault was it.  Notably, it was the second deal that collapsed for the property developer. 

The Evergrande’s worrisome financial situation had led to the cancellation of the deal worth USD 1.7 billion of its Hong Kong Headquarters. 

The problem has come just before its thirty-day grace period expires, which requires Evergrande to pay USD 83.5 million for an offshore bond in coupon payments. 

However, during the exchange filing on Wednesday, that the interest on the payments of the US dollar-denominated bonds had not expired that were due during September and October. 

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