Evergrande Group, a 25-year-old Chinese real estate company with more than $300 billion in liabilities, was officially declared in default by credit rating agency S&P Global on Friday after failing to make a bond payment earlier this month.
“We assess that China Evergrande Group and its offshore financing arm Tianji Holding Ltd. have failed to make coupon payments for their outstanding U.S.-dollar senior notes,” S&P said in a statement.
S&P also stated that Evergrande had requested that the ratings be withdrawn following the downgrades to ‘selective default,’ a term used by rating agencies to describe a missed payment on a bond but not necessarily all of its bonds.
“Evergrande, Tianji, or the trustee have made no announcement or any confirmation with us on the status of the coupon payments,” S&P said.
On December 9, Fitch downgraded China Evergrande Group and Kaisa Group to “restricted default.” On December 6, the grace period for repaying debts of $645 million and $590 million expired, and the struggling Chinese property developer or its subsidiaries Tianji and Hengda failed.
Evergrande and Kaisa had combined to default on $1.6 billion in debt. The former owes $1.2 billion, while the latter owes $400 million to a smaller Chinese property firm.
Reuters reported the story.