China Evergrande Group, a property developer, recently announced that it has been served an enforcement notice by the court regarding arbitration proceedings involving one of its subsidiaries and an executive director. The notice mandates the group to fulfil various financial obligations, including a payment of approximately 770 million yuan ($111.40 million) as compensation to the claimant.
China Evergrande Group, a property developer, recently announced that it has been served an enforcement notice by
the court regarding arbitration proceedings involving one of its subsidiaries and an executive director. The notice
mandates the group to fulfil various financial obligations, including a payment of approximately 770 million yuan
($111.40 million) as compensation to the claimant.
The arbitration proceedings centre around agreements made between the claimant, Guangzhou Kailong Real Estate (a
unit of China Evergrande Group), and the executive director Hui Ka Yan. These agreements were executed between
December 2016 and November 2020. In these deals, the claimant provided a capital injection of 5 billion yuan into
Hengda Real Estate, another subsidiary of China Evergrande, in exchange for a 1.6% ownership stake. However, the
agreements ultimately collapsed due to the non-completion of certain obligations.
As per the enforcement notice, Guangzhou Kailong and Hui Ka Yan are obligated to make additional payments related
to the outstanding dividends owed by Hengda Real Estate for the year 2020, which amounts to approximately 204
million yuan. Additionally, they are required to provide liquidated damages of about 51.53 million yuan to the
claimant.
Furthermore, the notice mandates Hui Ka Yan and the company to repurchase the claimant’s stakes in Hengda Real
Estate for a total sum of 5 billion yuan.
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