Evergrande’s main unit Hengda Real Estate Group will make coupon payment on onshore bonds after successful private negotiations with bond holders, a Reuters report said.
The real estate giant’s debt troubles had caused risk aversion in global markets after Chinese authorities last week said that the company may not be able to make repayment on loans to two banks due on Monday.
Due to a public holiday in China from Monday till today, the fate of Evergrande has hung in balance as investors drew comparison with the crisis that befell US investment banking giant Lehman Brothers back in September 2008.
Evergrande Group has cumulative liabilities of more than $300 billion and has seen its cash reserves dwindle due to slowdown in the Chinese property market as well as lack of funding avenues after state-owned lenders in China cut off credit lines.
The company in August had warned that it was at risk of default due to the ongoing crisis. Market observers have opined that Evergrande’s collapse could threaten the stability of the Chinese credit market and result in contagion effect for the rest of the world.
Currently, Evergrande Group shares in Frankfurt were trading 17 per cent higher at 0.30 euro.
