It’s been a long time coming but China Evergrande (which I blogged about nearly 2 years ago!), once China’s largest property developer and who’s debt crisis is widely viewed as the “Lehman Brothers” moment in China’s property crisis, has finally been de-listed, about 18 months after it was ordered to be liquidated.
What remains to be seen is what China’s government will do as China’s property crisis continues. It’s somewhat ironic given that it was the Chinese government which triggered the property sector’s implosion when it tried to crack down on the property bubble. Only time will tell how much pain the central government is willing for the sector to endure — the US was unable to stomach this pain during the Great Financial Crisis and ultimately made “heroic” moves to save the housing sector.
The clock started ticking for the delisting in late January last year, when Evergrande received a liquidation order from a Hong Kong court and trading of its shares was suspended. It has remained halted since then, having failed to meet requirements for a resumption of trading. In Hong Kong, a stock can be delisted if suspension lasts 18 months or longer.
The move will further diminish hopes for any recovery for Evergrande’s shareholders, who have seen the value of their investment evaporate in recent years.
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