Two years after a crisis erupted at China’s property developers, leaving bills unpaid, homes unbuilt and creditors trying to recover the scraps from defaulted firms, a burning question remains: why are real estate tycoons still owning and running their companies?
Hui Ka Yan, the billionaire founder of China Evergrande Group, could wind up keeping almost 42% of his shares in the world’s most indebted developer, according to a restructuring proposal. Zeng Jie, also known as Baby Zeng, might ultimately retain a 45% stake in Fantasia Holdings under an overhaul plan.
And among options that noteholders can choose from in Sunac’s restructuring proposal, one could result in Sun Hongbin remaining the controlling shareholder with at least 30% if all creditors subscribing to mandatory convertible bond options convert their notes into shares, according to people familiar with the matter.