China Evergrande, the giant embattled property developer, will not be able to publish its annual financial results on time, the company said on Tuesday.
The real estate giant blamed “drastic changes” to its business last year for the delay, adding that it would take its auditor a longer time to sift through the paperwork. The annual statement had been due by March 31.
The news is the latest setback for the world’s most indebted property developer, whose troubles sent shock waves through global markets last September as the company teetered on the edge of collapse. Investors feared the collapse of Evergrande would trigger a “Lehman moment” in China, recalling the 2008 collapse of Lehman Brothers, which heralded the global financial crisis.
Evergrande was once China’s biggest real estate developer, and its projects in hundreds of cities across China created millions of jobs for builders, painters, plumbers and other contractors. Now it is struggling to pay down a mountain of debt worth more than $300 billion to creditors, leaving contractors with unpaid bills and as many as one million home buyers with unfinished apartments.
For months last year, Evergrande swung from one loan to another, barely making the deadline on payments to lenders and foreign investors. In December, the government took a more hands-on role in helping the company manage its worsening financial situation. Later that month, global ratings agencies declared Evergrande to be in default, meaning it could no longer meet its financial obligations.
On Tuesday, the property developer also said banks had claimed $2.1 billion of cash from one of its subsidiaries, Evergrande Property Services. Evergrande tried to sell a $2.6 billion stake in the property management unit in October to raise cash for its mounting bills, but the deal fell through.
Evergrande suspended trading in its shares on Monday. A spokesperson for the company did not respond to a request for comment.
Source: NY Times