Fitch Ratings downgraded indebted Evergrande Group and its subsidiaries on Thursday and declared them as defaulters, as the grace period to make two coupon payments expired on Monday.
Fitch cut the developer's ratings to restricted default (RD) and said the company didn’t make any announcements or respond to a request seeking confirmation on the coupon payments, and it thus assumes payment was not made, the ratings agency said in a statement on Thursday. Evergrande, China's second-largest property company by sales, has more than $300 billion of debt and is considered the world’s most indebted developer.
The ratings were cut from 'C' and impact China Evergrande Group and its subsidiaries, Hengda Real Estate Group and Tianji Holding, even though there has been no initiation of bankruptcy filings, administration, receivership, liquidation, or other formal winding-up procedures, Fitch said.
"The downgrades reflect the non-payment of coupons due November 6, 2021 for Tianji's $645 million 13 per cent bonds and $590 million 13.75 per cent bonds after the grace period lapsed on December 6," Fitch said.
"The non-payment is consistent with an 'RD' rating, signifying the uncured expiry of any applicable grace period, cure period or default forbearance period following a payment default on a material financial obligation."
On December 3, Evergrande's chairman Hui Ka Yan issued a statement and said given the company's liquidity crunch, there was no guarantee the developer will have sufficient funds to continue to perform its financial obligations and would be looking to restructure.
"The group is taking a comprehensive view in assessing its overall financial condition, considering the interests of all stakeholders, upholding the principles of fairness and legality, and plans to actively engage with offshore creditors to formulate a viable restructuring plan of the company’s offshore indebtedness for the benefit of all stakeholders," Mr Hui said.
Shenzhen-based Evergrande owns more than 1,300 projects in 280 or more cities in China, according to its website. Its Hong Kong-listed property services arm has about 2,800 projects in more than 310 cities in China. The company also has businesses in electric vehicles, finance, healthcare and cultural tourism.
Fitch's analysis assumes Evergrande would be liquidated in a bankruptcy because it is an asset-trading company. The rating agency also assumes both Hengda and Evergrande would go into bankruptcy if Evergrande defaults.
Evergrande bondholders said they expect offshore creditors to be near the bottom of the queue for repayment and some offshore creditors are already consulting with financial and legal advisers, according to Bloomberg.
Ashmore Group, BlackRock, FIL, UBS and Allianz have all reported holding Evergrande debt, according to Bloomberg data.
China's $15 trillion economy accounts for about 18 per cent of global output and most analysts still believe the government will intervene to cushion the impact of Evergrande's debt crisis.
In September, Evergrande agreed to sell a 20 per cent stake in Shengjing Bank to the local Shenyang government for 10 billion yuan ($1.55bn). All proceeds must go towards settling debts with the lender, according to the statement at the time.
The End of Loneliness
Benedict Wells
Translated from the German by Charlotte Collins
Sceptre
Winners
Best Men's Player of the Year: Kylian Mbappe (PSG)
Maradona Award for Best Goal Scorer of the Year: Robert Lewandowski (Bayern Munich)
TikTok Fans’ Player of the Year: Robert Lewandowski
Top Goal Scorer of All Time: Cristiano Ronaldo (Manchester United)
Best Women's Player of the Year: Alexia Putellas (Barcelona)
Best Men's Club of the Year: Chelsea
Best Women's Club of the Year: Barcelona
Best Defender of the Year: Leonardo Bonucci (Juventus/Italy)
Best Goalkeeper of the Year: Gianluigi Donnarumma (PSG/Italy)
Best Coach of the Year: Roberto Mancini (Italy)
Best National Team of the Year: Italy
Best Agent of the Year: Federico Pastorello
Best Sporting Director of the Year: Txiki Begiristain (Manchester City)
Player Career Award: Ronaldinho
FROM%20THE%20ASHES
%3Cp%3EDirector%3A%20Khalid%20Fahad%3C%2Fp%3E%0A%3Cp%3EStarring%3A%20Shaima%20Al%20Tayeb%2C%20Wafa%20Muhamad%2C%20Hamss%20Bandar%3C%2Fp%3E%0A%3Cp%3ERating%3A%203%2F5%3C%2Fp%3E%0A
Global state-owned investor ranking by size
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United States
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China
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3.
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UAE
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4.
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Japan
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5
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Norway
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6.
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Canada
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Singapore
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Australia
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Saudi Arabia
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South Korea
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360Vuz PROFILE
Date started: January 2017
Founder: Khaled Zaatarah
Based: Dubai and Los Angeles
Sector: Technology
Size: 21 employees
Funding: $7 million
Investors: Shorooq Partners, KBW Ventures, Vision Ventures, Hala Ventures, 500Startups, Plug and Play, Magnus Olsson, Samih Toukan, Jonathan Labin
GAC GS8 Specs
Engine: 2.0-litre 4cyl turbo
Power: 248hp at 5,200rpm
Torque: 400Nm at 1,750-4,000rpm
Transmission: 8-speed auto
Fuel consumption: 9.1L/100km
On sale: Now
Price: From Dh149,900
KEY%20DATES%20IN%20AMAZON'S%20HISTORY
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UAE currency: the story behind the money in your pockets
Roll of honour
Who has won what so far in the West Asia Premiership season?
Western Clubs Champions League - Winners: Abu Dhabi Harlequins; Runners up: Bahrain
Dubai Rugby Sevens - Winners: Dubai Exiles; Runners up: Jebel Ali Dragons
West Asia Premiership - Winners: Jebel Ali Dragons; Runners up: Abu Dhabi Harlequins
UAE Premiership Cup - Winners: Abu Dhabi Harlequins; Runners up: Dubai Exiles
West Asia Cup - Winners: Bahrain; Runners up: Dubai Exiles
West Asia Trophy - Winners: Dubai Hurricanes; Runners up: DSC Eagles
Final West Asia Premiership standings - 1. Jebel Ali Dragons; 2. Abu Dhabi Harlequins; 3. Bahrain; 4. Dubai Exiles; 5. Dubai Hurricanes; 6. DSC Eagles; 7. Abu Dhabi Saracens
Fixture (UAE Premiership final) - Friday, April 13, Al Ain – Dubai Exiles v Abu Dhabi Harlequins
THE SPECS
Engine: 1.5-litre
Transmission: 6-speed automatic
Power: 110 horsepower
Torque: 147Nm
Price: From Dh59,700
On sale: now
Match info:
Leicester City 1
Ghezzal (63')
Liverpool 2
Mane (10'), Firmino (45')
Jetour T1 specs
Engine: 2-litre turbocharged
Power: 254hp
Torque: 390Nm
Price: From Dh126,000
Available: Now
WOMAN AND CHILD
Director: Saeed Roustaee
Starring: Parinaz Izadyar, Payman Maadi
Rating: 4/5
GOODBYE%20JULIA
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Key facilities
- Olympic-size swimming pool with a split bulkhead for multi-use configurations, including water polo and 50m/25m training lanes
- Premier League-standard football pitch
- 400m Olympic running track
- NBA-spec basketball court with auditorium
- 600-seat auditorium
- Spaces for historical and cultural exploration
- An elevated football field that doubles as a helipad
- Specialist robotics and science laboratories
- AR and VR-enabled learning centres
- Disruption Lab and Research Centre for developing entrepreneurial skills
