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BusinessToday
2 days ago
- Business
- BusinessToday
Hong Kong Court Orders China South City's Liquidation
China South City Holdings Ltd, the largest Chinese property developer by assets to face court-ordered liquidation since China Evergrande Group, has been ordered to wind up by Hong Kong's High Court, dealing another blow to already fragile investor confidence in the country's real estate sector. Bloomberg reported that the ruling from Judge Linda Chan came after the Shenzhen-based company failed to secure sufficient creditor backing for its restructuring plan. The winding-up petition was filed by Citicorp International Ltd, acting as trustee for the firm's dollar bonds, raising fresh concerns about recovery prospects for offshore creditors in China's ongoing property turmoil. China South City, burdened with HK$60.9 billion in liabilities as of Dec 31, 2024, had been in protracted talks with creditors. Disagreements centred on calls for greater participation from its largest shareholder, state-owned Shenzhen SEZ Construction and Development Group Co, and direct engagement with its chairman, Li Wenxiong. The liquidation adds to a growing list of high-profile defaults and court orders since the sector's downturn began in 2021. At least six Chinese developers have been ordered to wind up in Hong Kong, underscoring the limited success of Beijing's measures to stabilise the market. Even UBS Group AG, previously among the most optimistic forecasters, has now pushed back its recovery timeline unless significant new stimulus is introduced. Market watchers say the collapse could further weigh on Chinese high-yield dollar bonds, already trading at distressed levels, and heighten scrutiny of state-linked developers previously seen as safer bets.
Straits Times
2 days ago
- Business
- Straits Times
Developer China South City ordered to liquidate by Hong Kong court
Sign up now: Get ST's newsletters delivered to your inbox Liquidation order shows how China's years-long property crisis continues to shake one-time giants of the real estate industry. HONG KONG – Developer China South City Holdings was ordered to liquidate by Hong Kong's High Court, making it the biggest Chinese builder by assets to be wound up since China Evergrande Group. The ruling from Judge Linda Chan came after China South City failed to win enough support from creditors for its restructuring proposal, following months of talks. The liquidation order shows how China's years-long property crisis continues to shake one-time giants of the real estate industry. Despite government efforts to prop up the ailing sector, home sales are still weak, making any near-term recovery unlikely. Even UBS Group, which had been among the few firms predicting a recovery, is now expecting a delay unless Beijing introduces additional stimulus measures. Hong Kong's courts have issued at least six wind-up orders for Chinese developers since the crisis began in 2021, including one for Evergrande, whose liquidation was one of the most complicated given its asset size and the number of stakeholders. China South City had been at odds with creditors over several issues. During a hearing in May, creditors said they wanted Shenzhen SEZ Construction and Development Group, China South City's biggest shareholder, to play a larger role in the debt talks. They were specifically seeking access to the Shenzhen SEZ Construction's chairman, Li Wenxiong, who serves as a co-chairman of China South City. China South City's ownership structure is similar to that of China Vanke, a major Chinese developer, which received state support in January, led by local authorities in the company's hometown of Shenzhen. China South City had total liabilities of about HK$60.9 billion (S$10 billion) as of Dec. 31, 2024, according to its annual report. Top stories Swipe. Select. Stay informed. Business Keppel to sell M1 unit's telco business to Simba for $1.43 billion Business Nvidia, AMD to pay 15% of China chip sale revenues to US, official says Singapore Healthy lifestyle changes could save Singapore $650 million in healthcare costs by 2050: Study Singapore BTO income ceiling, age floor for singles being reviewed: Chee Hong Tat World Netanyahu says Israel's new Gaza offensive will start soon Opinion Anwar's government: Full house but plenty of empty offices Singapore Man's claim amid divorce that his mother is true owner of 3 properties cuts no ice with judge Business Singapore can deliver and thrive in a fragmented global economy: Morgan Stanley analysts The winding-up petition against China South City was filed by Citicorp International, which is the trustee of the developer's dollar bonds. BLOOMBERG
