China Evergrande Group has reportedly started repaying investors in its wealth management products with real estate.
The company has more than $300bn in liabilities and is facing a liquidity crisis. It is working to raise funds to repay its lenders and suppliers, Reuters reported.
On 23 September 2021, Evergrande has a bond interest payment of $83.5m.
Investors wanting to redeem wealth management products for physical assets can approach Evergrande investment consultants or visit local offices, the company said in a WeChat post.
Approximately $6bn (CNY40bn) in the company’s wealth management products are outstanding, news agency Caixin said. These type of products are usually held by retail investors.
Specifics regarding payment methods and details are contingent on local conditions, Reuters added citing a customer service representative.
Wealth management product investors can select discounted apartments, office, retail space or car parks for repayment, as per a proposal viewed by the news agency.
A stock exchange filing earlier this month revealed that Evergrande repaid CNY219.5m in overdue debts due to supplier Skshu Paint with three unfinished property projects. In total, Evergrande had repaid overdue debts worth CNY234.74m to Skshu.
Last month, China’s central bank warned Evergrande’s senior executives that the company must lower its debt risks and prioritise stability.
On 10 September 2021, Evergrande agreed to repay all of its matured wealth management products soon.