(Bloomberg) — China Huarong Asset Management Co. is set to resume trading Wednesday following a $6.6 billion bailout, a type of state-orchestrated rescue that appears unlikely for embattled developer China Evergrande Group.
Huarong last week completed a recapitalization of 42 billion yuan from a group of state-back investors led by Citic Group, and is selling none-core assets to streamline its sprawling empire. After roiling the Asian credit markets and posting a record loss of $15.9 billion, Huarong has proved to be too big to fail for Chinese authorities at a time when the slowing economy is grappling with surging debt defaults.
Evergrande shares meanwhile rose Tuesday, as trading resumed after the company said it would work with authorities on an order to demolish 39 apartment buildings in Hainan province that were deemed illegal. Evergrande was declared in default last month after failing to make interest payments on its debt, setting up what’s expected to be China’s biggest debt restructuring.
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- Some Kaisa Bondholders Yet To Get Coupon Payments Due Last Week
- Chinese Developers Had Annual Drop in Property Sales Last Year
- Evergrande Hainan Order Suggests Fire Sale Difficulties: React
- Hard Landing in Property Market Would Crater China’s Economy
- DaFa Properties Postpones Dividend Payment, Sells Stake in Unit
- Surging Yields Come at Convenient Time for Beijing: China Today
Huarong to Resume Trading After a $6.6 Billion Bailout (8:15 a.m. HK)
China Huarong is set to resume trading in Hong Kong on Wednesday morning after the troubled financial giant raised $6.6 billion in a state-orchestrated rescue that brought it back from the brink of a crisis.
The Beijing-based distressed asset manager applied to resume trading as it fulfills share resumption guidance, according to a statement filed with the Hong Kong stock exchange. The company said it has taken measures to return to its core business, simplify its structure, reduce capital consumption and increase returns.
China Huarong reported profit of 1.62 billion yuan ($255 million) in the first six months of 2021, which compares with a loss of about 106.3 billion a year earlier. Chairman Wang Zhanfeng is expected to hold a press briefing on Wednesday.
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