Beijing has told the founder of the embattled Evergrande group to use his own money to lessen the company’s massive debt after the company’s crisis brought attention to billions of his wealth.
Authorities in China issued the directive after the property giant missed an $84 million bond payment on Sep. 23, according to people familiar with the matter, Bloomberg reported.
The Sep. 23 bond payment was reportedly settled last week within a 30-day grace period, and another interest payment of $45 million is due on Oct. 29.
According to the Bloomberg Billionaires Index, Evergrande’s founder Hui Ka Yan is estimated to be worth $7.6 billion — a small fraction of the company’s debt pile of $300 billion.
It is also still unknown if Hui’s wealth is liquid enough to be used for settling liabilities. Hui’s worth is largely derived from his shares in Evergrande whose value has dropped by more than 80 percent this year.
Local Chinese government units are also monitoring Evergrande’s bank accounts to ensure that funds are being used to complete ongoing construction projects and not to settle its debt.
Evergrande, the second largest property developer in China, has been stirring markets around the world over fears of its debt crisis causing contagion across the international economy.
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