BEIJING: Cash-strapped developer China Evergrande Group has begun repaying investors in its wealth management products with real estate, a unit of its main Hengda Real Estate Group said.
Evergrande, with over US$300 billion in liabilities, is in the throes of a liquidity crisis that has left it racing to raise funds to pay its many lenders and suppliers. It has a bond interest payment of US$83.5 million due on Thursday (Sep 23).
The company said in a WeChat post dated Saturday that investors interested in redeeming wealth management products for physical assets should contact their investment consultants or visit local offices.
Financial news outlet Caixin reported on Sunday that an estimated 40 billion yuan (US$6 billion) in Evergrande wealth management products are outstanding. Such products are typically held by retail investors.
Specific payment methods and details are subject to local conditions, a customer service representative told Reuters on Sunday.
According to a proposal seen earlier by Reuters that Evergrande did not confirm, wealth management product investors can choose from discounted apartments, office, retail space or car parks for repayment.
Earlier this month, a stock exchange filing showed that Evergrande had repaid 219.5 million yuan in overdue debts due to supplier Skshu Paint in the form of apartments in three unfinished property projects.
On Sep 10, Evergrande had vowed to repay all of its matured wealth management products as soon as possible.
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