The story
Founded by Hui Ka Yan in 1996, in Shenzhen.1
Initially called the Hongda Group, Evergrande was founded by Hui Ka Yan in the southern Chinese city of Guangzhou in 1996, during a period of mass urbanization in China. In October 2009, the company raised US$722 million in an initial public offering on the SEHK.
In 2021, the payments Evergrande had to make on its debt started the Chinese property sector crisis; Evergrande's total debts were estimated in the hundreds of billions of dollars. This was one of the reasons for a drop in many stock market indices on 20 September 2021. At the end of 2021, the Chinese government was reportedly working to restructure Evergrande in order to resolve the crisis. The group also sought a moratorium on the early repayment option on one of its yuan-denominated bonds from its bondholders on 7 January 2022.
In 2022, the company announced it would move its headquarters to Guangzhou due to a need to reduce spending. In April 2022, Reuters reported that construction had been started again at many projects and that the company still had liabilities of US$300 billion.
On 17 July 2023, Evergrande made public that it had made a net loss attributable to shareholders of 476 billion yuan (US$66.3 billion) for 2021 and of 105.9 billion yuan (US$14.7 billion) for 2022. The group stated that its total liabilities on 31 December 2022 stood at 2.43 trillion yuan (roughly US$340 billion). Court hearings on the restructuring of the group's debts were to be held in July 2023 in Hong Kong and the Caribbean. On 17 August 2023, Evergrande filed for Chapter 15 of the U.S. bankruptcy code for protection from creditors, with the U.S. bankruptcy court in Manhattan. On 28 August 2023, Evergrande stock plunged in Hong Kong as trading resumed after a 17-month suspension, tumbling by 79 per cent to 35 HK cents, as opposed to the pre-suspension price of HK$1.65 on 21 March 2022. In September 2023, Bloomberg reported that Hui Ka Yan (Xu Jiayin), the billionaire chairman of Evergrande, was placed under police control. Caixin reported that Xia Haijun, an ex-chief executive officer of Evergrande, and Pan Darong, a former chief financial officer, were detained by Chinese authorities.
On 29 January 2024, the High Court of Hong Kong made a winding-up order against Evergrande due to a lack of a viable restructuring plan. Trading was halted for stocks in China Evergrande, China Evergrande New Energy Vehicle Group, and Evergrande Property Services. The Hong Kong court order came after bondholders decided that winding down Evergrande was better than Evergrande's plan to give control of most of the developer to Chinese banks and impose losses on foreign creditors. It was thought by investors that the restructuring plan would cause losses that would have potentially been steep enough that the losses of foreign creditors would be lower if Evergrande liquidated.
The court order allowed liquidators from Alvarez and Marsal to take over all of Evergrande's subsidiaries around the world so that Evergrande's assets could be sold to repay its debt. However, 90% of Evergrande's assets were in mainland China and most of the assets had already been sold, pledged to Chinese domestic creditors, or frozen by Chinese banks at the time.
Evergrande stated on 19 March 2024 that the China Securities Regulatory Commission (CSRC) had found that the company had overstated its revenue in 2019 by 214 billion yuan (nearly $30 billion), or about half, and in 2020 its revenue was overstated by nearly 80%, or 350 billion yuan ($48.6 billion). The CSRC also suspected problems with the bonds Evergrande issued. The regulator fined Evergrande 4.2 billion yuan ($579.5 million) for falsifying its revenue, among other financial misconduct.
In August 2026, a Chinese court sentenced Hui Ka Yan, the founder of the Evergrande Group, to life imprisonment for financial fraud, corruption, and embezzlement, and imposed a total fine of 15.8 billion yuan (2.35 billion US dollars) on Evergrande and its real estate division.
From Wikipedia’s article on Evergrande Group, shared under CC BY-SA 4.0.5