Hui Ka Yan, the founder of Evergrande Group, will have a property in Hong Kong auctioned.

This auction is caused by debt problems. Public information shows that the High Court of Hong Kong has previously ruled that Hui Ka Yan should repay over 5.3 billion yuan of debt to Heng Xin Heng Ju, a subsidiary of CITIC Group, otherwise the property under his name will be sold to repay the debt based on the absolute charging order.

According to the Hong Kong Economic Journal, Heng Xin Heng Ju subsequently filed a lawsuit in court, requesting Hui Ka Yan to hand over a property located in Tsim Sha Tsui, Hong Kong, and sell the property to repay part of the debt. The High Court approved the auction of the property to repay the debt recently. It is reported that the current market price of the property is about 4.96 million Hong Kong dollars.

Public information shows that the property is a two-bedroom apartment with an area of about 375 square feet. After Hui Ka Yan made his first fortune in the real estate business in the early years, he purchased the property for HK$1.75 million in 1999.

In fact, this is not the first time that Hui Ka Yan's properties in Hong Kong have been disposed of.

In May of this year, one of the villas owned by Hui Ka Yan in Hong Kong, located at 10 Broadwood Road, The Peak, was sold for approximately HK$470 million after being on the market for more than a year. The price was nearly half of the estimated value of HK$880 million a year ago, equivalent to a 53% discount.

It is reported that the property is House B, No. 10 Broadwood Road, with a usable area of approximately 5,171 square feet. It has been under the control of Bank of China (Asia) for a long time and was put up for sale about a year ago.

According to public information, Xu Jiayin purchased several villas, including Block B, Block C, and Block E on the top of Brunei in 2010, with a total market value of approximately 2.5 billion Hong Kong dollars. After Evergrande faced a liquidity crisis, Xu Jiayin mortgaged these luxury homes.

In October 2022, Xu Jiayin mortgaged Block B to China Construction Bank (Asia) as an extension for overdue bonds, which was formally taken over by China Construction Bank (Asia) in March 2023. Blocks C and E were mortgaged to the financial company "Orix".

Since the second half of 2021, Evergrande's debt restructuring has been slow in progress. On January 29, 2024, the High Court of Hong Kong held a hearing for Evergrande's winding-up petition, and the judge ruled to wind up Evergrande on the spot.

On May 31 of this year, the China Securities Regulatory Commission officially issued an "Administrative Penalty Decision" for Evergrande Group and Xu Jiayin, imposing a mandatory correction, a warning, and a fine of 4.175 billion yuan on Evergrande, while the former chairman and actual controller of Evergrande, Xu Jiayin, was fined the maximum of 47 million yuan and subjected to a lifetime ban from the securities market.

The CSRC determined that from 2019 to 2020, Evergrande inflated its revenue and profits by prematurely recognizing income, resulting in fraudulent issuance of bonds in the exchange market. The disclosed annual reports contained false records. Additionally, Evergrande failed to disclose its periodic reports on time, failed to disclose major lawsuits and arbitrations as required, and failed to disclose the situation of outstanding debt repayments.

Currently, the liquidators of Evergrande have filed lawsuits in the name of China Evergrande in the High Court of Hong Kong against the company's Chairman, Xu Jiayin, former CEO Xia Haijun, former CFO Pan Darong, Xu Jiayin's ex-wife Ding Yumei, and three related entities of Xu Jiayin and Ding Yumei to recover approximately 6 billion US dollars in dividends and remuneration.

As Xu Jiayin's aforementioned Hong Kong properties are about to be auctioned, the liquidators of Evergrande have filed a winding-up petition against a subsidiary of Evergrande.

On September 13, China Evergrande Group issued an announcement that, acting as per the instruction of the liquidators, the company filed a winding-up petition against CEG Holdings (BVI) Limited, a wholly-owned subsidiary directly held by Evergrande, to the High Court of Hong Kong on September 12, 2024.

Evergrande disclosed that Edward Simon Middleton and Huang Yongshi of Anmai Consultant Co., Ltd. were appointed as joint and separate provisional liquidators of CEG Holdings by the Hong Kong court on September 12, 2024. As of the date of the above announcement, CEG Holdings holds 49.65% of the shares of Evergrande Services Group Limited, while Evergrande Services is a member company of Evergrande Group.

"The liquidators believe that the appointment order of the provisional liquidators allows the liquidators to preserve the assets of this group for realization, and to seek benefits for the creditors and other shareholders of this group." Evergrande said.