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Liquidators of China Evergrande Group have entered into an exclusivity agreement with a selected bidder to sell their 51.016% stake in Evergrande Property Services, according to a recent exchange filing. The parties will undertake exclusive negotiations for a period of 30 business days, although the identity of the bidder and transaction value have not been disclosed. The development comes as the group continues to address its prolonged debt crisis, having defaulted on over USD 300 billion in liabilities since 2021. The services arm, which was valued at over HKD 94 billion at listing in 2020 and peaked near HKD 200 billion in 2021, currently has a market capitalisation of approximately HKD 13.19 billion. The transaction forms part of ongoing efforts to monetise assets under liquidation proceedings.
Liquidators of China Evergrande Group have entered into an exclusivity agreement with a selected bidder in recent days to sell their majority stake in Evergrande Property Services, initiating a formal negotiation process as part of the group's ongoing asset monetisation efforts. Advertisement
According to an exchange filing, the parties have agreed to conduct exclusive sale negotiations for a period of 30 business days. The agreement provides the selected bidder with sole rights to negotiate the transaction during this period, although further details, including the identity of the bidder and the valuation of the proposed deal, have not been disclosed.
The liquidators currently hold a 51.016% stake in Evergrande Property Services, representing a controlling interest in the company. The proposed transaction is expected to involve the transfer of this majority shareholding, subject to the outcome of negotiations and necessary approvals.
The development comes amid broader efforts to address the financial distress of China Evergrande Group, which has been undergoing a prolonged debt resolution process following its default in 2021. The developer accumulated liabilities exceeding USD 300 billion, making it one of the most indebted real estate companies globally and a central case in China's ongoing property sector downturn.
Earlier in the day, founder Hui Ka Yan pleaded guilty to multiple charges, including misuse of funds, adding to the developments surrounding the group's restructuring and legal proceedings.
Evergrande Property Services, the group's property management arm, was listed in Hong Kong in 2020 with a valuation exceeding HKD 94 billion and subsequently reached a peak market capitalisation of approximately HKD 200 billion in 2021. However, its valuation has declined significantly in recent years, with its market capitalisation standing at around HKD 13.19 billion as of recent trading sessions.
The property services business has remained a key asset within the group's portfolio, given its recurring revenue model and operational footprint across residential developments. The potential sale of a controlling stake is therefore viewed as a significant step in unlocking value from non-core or monetisable assets under liquidation.
Market participants indicated that the exclusivity agreement signals progress in the disposal process, although the absence of disclosed deal terms suggests that negotiations are at an early stage. The 30-day exclusivity window is expected to allow both parties to undertake due diligence and finalise transaction structures.
Evergrande Property Services has not provided additional details regarding the bidder or potential timelines for completion. The outcome of the negotiations will depend on regulatory approvals, agreement on valuation, and broader restructuring considerations linked to the parent entity.
The proposed transaction forms part of a wider series of asset sales and restructuring measures being undertaken to address the group's liabilities, as stakeholders continue to seek recovery through the liquidation and monetisation process.
Source - Reuters
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