'Default' Evergrande Chairman Sells Additional Shares Worth 75.4 Billion KRW

[Image source=Yonhap News]

[Asia Economy Reporter Eunmo Koo] The chairman of Evergrande, a Chinese real estate developer that has declared default, has secured cash by selling additional company shares.

According to Bloomberg on the 11th, Evergrande announced through a disclosure on the Hong Kong Stock Exchange the previous day that its largest shareholder, Chairman Xu Jiayin, sold 277.8 million shares of the company between the 6th and 9th. As a result, Xu's stake in Evergrande decreased from 61.88% to 59.78%.

The sale price was not disclosed. Bloomberg estimated that based on the average trading price of Evergrande shares this week, the sale amount is approximately 498 million Hong Kong dollars (about 75.4 billion KRW).

Earlier, on the 26th of last month, Chairman Xu sold 1.2 billion shares of the company, raising 2.68 billion Hong Kong dollars (about 410 billion KRW). This was the first time Xu sold company shares since Evergrande's listing on the Hong Kong Stock Exchange in 2009.

Bloomberg reported, "Xu Jiayin, who became China's second richest person in 2017 with assets worth 42 billion USD (about 49 trillion KRW), is now moving quickly to prevent Evergrande's bankruptcy, including disposing of his personal assets."

Global credit rating agency Fitch downgraded Evergrande to a 'restricted default' rating on the 9th, officially confirming the default. Evergrande's debt stood at about 2 trillion yuan (364 trillion KRW) as of the end of June.

Earlier, Evergrande announced on the 6th that a risk resolution committee involving state-owned enterprises and financial institutions had been launched. This is being interpreted as the start of a government-led debt restructuring process.

This content was produced with the assistance of AI translation services.