Chinese property firm Evergrande's EV company says its executive director detained
The electric vehicle unit of troubled Chinese property developer China Evergrande says its vice chairman has been detained by police on “suspicion of illegal crimes.”
BANGKOK — A top executive of China Evergrande's electric vehicle company has been detained by police in the latest sign of trouble for the world's most heavily indebted property developer.
China Evergrande New Energy Vehicle announced the detention of Liu Yongzhuo, its vice chairman and an executive director, in a notice Monday to the Hong Kong Stock Exchange. Its shares sank 6% after they resumed trading later in the day.
That followed news over the weekend that Zhongzhi Enterprise Group, a major shadow bank in China that has lent billions in yuan (dollars) to property developers including Evergrande, filed for bankruptcy liquidation after it was unable to pay its debts.
A crackdown on excessive borrowing that began several years ago has left dozens of Chinese developers out of business or struggling for survival. The industry-wide meltdown has snagged a vital cog in China’s economic engine, reverberating through financial markets.
Share prices sank Monday in Hong Kong and Shanghai, with the benchmark Hang Seng index down 1.9%. Evergrande Group’s shares lost 1.8%.
Evergrande has been in crisis since it defaulted on its debt obligations two years ago. It is in the midst of a restructuring that includes selling off assets to avoid defaulting on $340 billion in debt, and the company has said its chairman Hui Ka Yan is facing “mandatory measures in accordance with the law." His status is unclear.
Evergrande New Energy Vehicle saw its shares tumble nearly 20% last week after it said a deal to sell shares to Dubai-based NWTN Motors had lapsed. The brief
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