Creditors sue China Evergrande Group for $13 billion in claims

Chinese creditors have sued China Evergrande Group for more than $13 billion in allegedly overdue payments, according to a report.

A Chinese court assigned to handle civil lawsuits against Evergrande accepted 367 cases, with claims totalling 84 billion yuan ($13.2 billion), the Financial Times reported, citing official records. The cases were accepted between late August and earlier this month, the report said — in the period after financial regulators told the developer to resolve its debt problems and up to Fitch Ratings’ downgrade of the developer to ‘restricted default’ last week.

Meanwhile, Shimao Group Holdings Ltd. jumped as much as 11 per cent in Hong Kong trading on Thursday after its shares had fallen to a decade low. Calm also returned on Thursday to China’s junk dollar bond market, with average prices rising as much as 2 cents on the dollar in morning trade after Citigroup  strategists turned overweight. Shimao’s note due 2022 climbed 1.9 cents to 60.5 cents on the dollar after a three-day rout.

China’s financial regulator is coordinating negotiations between Shimao and some trust firms for loan extensions, according to people familiar with the matter, a sign that authorities want to prevent a cash crunch at the embattled developer.

Company told to prioritise paying workers, suppliers

China Evergrande Group is prioritising payments to migrant workers and suppliers as regulators urge the cash-strapped developer to head off any risk of social unrest, according to people familiar with the matter.

Authorities are particularly focused on making sure payrolls are met before the Lunar New Year holidays starting February 1, when thousands of migrant construction workers are due to reunite with their families, the people said, asking not to be named discussing private conversations. (Bloomberg)