Embattled Chinese developer Country Garden faces winding-up petition

Hong Kong: Embattled Chinese developer Country Garden is facing a winding-up petition in Hong Kong, months after the company started what is expected to be the second-largest restructuring effort among its peers, following that of China Evergrande Group, a media report said.

Country Garden received a winding-up petition filed by Ever Credit, a wholly-owned unit of Kingboard Holdings, on Tuesday due to non-repayment of a term loan worth about HK$1.6 billion ($204 million), including accrued interest, according to a filing with the Hong Kong stock exchange on Wednesday, South China Morning Post reported.

The petition comes after the developer – once China’s largest by sales – defaulted on a dollar bond in last October, causing jitters in both the bond and stock markets given the scale of the company’s projects.

A Hong Kong court ordered the liquidation of China Evergrande Group, the world’s most indebted property developer, in late January, South China Morning Post reported.

There are still questions about how the collapse of Evergrande, the poster boy of China’s real-estate crisis, will affect investors, thousands of workers and homebuyers waiting for their apartments, CNN reported.

As for Country Garden, it said in the filing that it would “vigorously” oppose the liquidation petition, which was filed at Hong Kong’s High Court on Tuesday. A court hearing has been set for May 17, it added.

China’s economy has been hobbled by a real-estate downturn since 2021, when a government crackdown on developers’ borrowing triggered a liquidity crisis in the sector, CNN reported.