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Evergrande posts photos of workers at dozens of job sites as troubles mount
Company expected to prioritize onshore obligations over international debt
China Evergrande Group, whose $300 billion of liabilities make it the world’s most indebted developer, tried to reassure investors that it’s still hard at work as it missed its second offshore bond interest payment in a week.
At least three local Evergrande offices posted time-stamped photos of workers at construction sites on social media, according to Insider.The Pearl River Delta office posted photos from Sept. 24 and said it would deliver on time 20 local developments that started this week. In Guizhou, Evergrande provided photos on WeChat of workers at 16 sites, while Shenzhen offered pictures at 10.
Insider said it couldn’t find photos or videos of construction sites on Weibo.
“Handing over properties is Evergrande’s commitment to every customer, and a responsibility we must fulfill,” the Shenzhen office wrote in its post on Wednesday. “In the last few days, Evergrande has made resuming construction and delivering our properties to buyers our priority.”
That same day, two bondholders said the company missed a $47.5 million interest payment on a U.S. dollar bond due in March 2024, Reuters reported. Evergrande, which has about $20 billion of offshore debt, hadn’t contacted overseas investors about the missed payments by the end of the day on Wednesday.
On Thursday, however, Evergrande said it had repaid an unspecified amount of wealth management products that are mostly owned by domestic retail investors. Legally, local investors have priority for repayment over their overseas counterparts.
“I can’t see there being much willingness to give a fairer outcome to offshore bondholders rather than onshore banks, let alone house buyers and people who have lent onshore through the personal loan structures,” said Alexander Aitken, a partner at Herbert Smith Freehills in Hong Kong.