Global Markets
Home›Global Markets›China›Hong Kong court backs Evergrande unit in about HK$6b d…
Hong Kong court backs Evergrande unit in about HK$6b debt case
The ruling dismisses Yingjia International Properties’ bid to block an offshore unit from filing a winding-up petition, after State Hero demanded HK$5.97 billion in principal and interest.
A Hong Kong court ruled in favour of embattled conglomerate Evergrande in a debt-recovery dispute, allowing an Evergrande-linked entity to pursue about HK$6 billion, or about US$764.7 million, from a third party after the judge rejected the borrower’s arguments as fabricated, according to the South China Morning Post.
The High Court dismissed an injunction application filed by Yingjia International Properties seeking to restrain offshore entity State Hero Holdings from presenting a winding-up petition, and it also rejected Yingjia’s request for an interim injunction pending a possible appeal, the outlet reported.
The case centers on a statutory demand State Hero served on Yingjia International on February 13, demanding repayment of HK$5.97 billion in loan principal and accrued interest. The court heard the underlying loan dates to an agreement reached in March 2021 in Hong Kong, with repayment due in a single tranche within two years to avoid interest, and with annual interest set at 4% if the repayment deadline was missed.
The reporting adds that the funds were transferred the following month to Honour Best International Trade to subscribe for 183 million new shares issued by China Evergrande New Energy Vehicle Group, or NEV. State Hero is described as an indirect wholly owned subsidiary of China Evergrande Group, which is now controlled by court-appointed liquidators.