Chinese Property Developer Kaisa Group Latest to Add to the Contagion Fear
Shares of Chinese property developer Kaisa Group halted after the company announced it had missed payment on a wealth management product
Shares of Chinese property developer Kaisa Group halted after the company announced it had missed payment on a wealth management product
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Kaisa Group Holdings (1638.HK) became the latest to add to the contagion worry in the debt ridden Chinese real estate sector. The company’s trading was halted in the Hang Seng Exchange on Friday on request of the company.
According to Reuters, the company announced on Thursday its finance unit had missed payment on a wealth management product.
Chinese property developers in the last couple of months saw offshore bond defaults, credit rating downgrades and heavy debt note selloff raising contagion fears globally.
Kaisa announced due to dampened real estate sector outlook in China the company is facing unprecedented liquidity crunch. The company said it is working on to raise funds by speeding up asset sales.
According to Reuters, the  Kasia is ranked 25th largest developer in the country by home sales. Additionally, it also has the highest offshore debt to come due in the following year after China Evergrande Group.
Local media Cailianshe reported, regulators are to meet on Friday to discuss the liquidity crunch issues in Kaisa and Fantasia which earlier defaulted on offshore bond last month.