World China Evergrande ordered to liquidate in landmark moment for crisis-hit sector

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HONG KONG, Jan 29 (Reuters) - A Hong Kong court on Monday ordered the liquidation of property giant China Evergrande Group (3333.HK), opens new tab, dealing a fresh blow to confidence in the country's fragile property market as policymakers step up efforts to contain a deepening crisis.

Justice Linda Chan decided to liquidate the world's most indebted developer, with more than $300 billion of total liabilities, after noting Evergrande had been unable to offer a concrete restructuring plan more than two years after defaulting on its offshore debt and following several court hearings.

"It is time for the court to say enough is enough," Chan said in court on Monday.

The decision sets the stage for what is expected to be a drawn-out and complicated process with potential political considerations as investors watch whether the Chinese courts will recognise Hong Kong's ruling, given the many authorities involved. Offshore investors will be focused on how Chinese authorities treat foreign creditors when a company fails.

Chan appointed Alvarez & Marsal as the liquidator, saying an appointment would be in the interests of all creditors because it could take charge of a new restructuring plan for Evergrande at a time when its chairman, Hui Ka Yan, is under investigation for suspected crimes.

 
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