(Reuters) -China Evergrande Group said on Monday it has applied to the Hong Kong Stock Exchange for trading in its shares to resume on Tuesday, adding there is currently no other inside information related to the company that needs to be disclosed.
On Thursday, trading in shares of the embattled Chinese property developer were suspended and the company later said its founder, Hui Ka Yan, was being investigated over suspected “illegal crimes”.
The news signalled for the first time that authorities could
hold the company’s billionaire founder accountable for the developer’s spiralling financial woes.
Chairman Hui is being investigated on suspicion of transferring assets offshore while the indebted property developer struggles to complete unfinished projects, the Wall Street Journal reported on Monday.
Evergrande did not respond to a Reuters request for comment.
With more than $300 billion in liabilities – roughly the size of Finland’s gross domestic product – Evergrande has become the poster child of a debt crisis in China’s property sector, which contributes to roughly a quarter of the economy.
Evergrande has been working to get creditors’ approval for restructuring its offshore debt. The process grew more complicated last week after Evergrande said it was unable to issue new debt due to an investigation into its main China unit.
The offshore debt restructuring plan now looks set to falter and the risks of the company being liquidated are rising, some analysts said.
Reuters reported last Tuesday that a major Evergrande offshore creditor group was planning to join a liquidation court petition filed against the developer if it does not submit a new debt revamp plan by the end of October.
(Reporting by Himanshi Akhand in Bengaluru; Writing by Anne Marie Roantree; Editing by Arun Koyyur and Sharon Singleton)