By Gina Lee
Investing.com – China Evergrande Group's (HK:3333) shares tumbled on Thursday, as investors expressed skepticism about the company's thinly detailed plan to have a preliminary restructuring proposal in place in six months.
The developer’s Hong Kong shares tumbled 6.21% to HK$1.66 ($0.21) by 11:56 PM ET (4:56 AM GMT), after falling as low as HK$1.6 earlier in the session. This was near its lowest level in almost two weeks.
Hong Kong’s benchmark Hang Seng Index also slid 2.41%, part of a downward trend in Asian shares after the U.S. Federal Reserve signaled forthcoming interest rate hikes in its policy decision handed down on Wednesday. The Hang Seng Mainland Properties Index also slid 2.5% on Thursday.
China Evergrande executives told creditors in a call late on Wednesday that the company hopes to work with them to achieve a risk management solution. The company added that it would treat all categories of creditors "fairly and follow international practice", while also urging them not to take any "aggressive legal actions."
However, some bondholders remained disappointed after the 25-minute call, which included prepared answers to questions. They said the call failed to give any insight into the company's plans.
The company’s communication with creditors comes as Chinese authorities tighten control over the property developer and adopt measures to stabilize the debt-ridden property sector.
China Evergrande, once one of the country’s top developers, now has a debt pile of more than $300 billion and continues its struggle to repay its creditors, suppliers, and investors in wealth management products.
The company missed some dollar bond payments in December 2021, triggering calls for communication, and nearly $20 billion of its international bonds are now deemed to be in default.