HONG KONG (Reuters) – Fitch Ratings said on Thursday it has decided to withdraw its rating on embattled property developer China Evergrande Group and two of its subsidiaries as the firms have stopped participating in the process.
The rating agency in December downgraded Evergrande and its subsidiaries, Hengda Real Estate Group Co Ltd and Tianji Holding Ltd, to so-called “restricted default” status, saying the firms had defaulted on their offshore bond obligations.
In its statement on Thursday, Fitch said that it would no longer have sufficient information to maintain the ratings on Evergrande, the world’s most indebted developer with more than $300 billion in debt, and two of its subsidiaries.
“Accordingly, Fitch will no longer provide ratings or analytical coverage for Evergrande and its subsidiaries,” it said.
Evergrande, which has struggled to repay suppliers and complete housing projects, has become the poster child of China’s property sector crisis as it lurched from one missed offshore debt payment deadline to another.
The firm is considering repaying offshore public bondholders owed around $19 billion with cash instalments and equity in two of its Hong Kong-listed units, Reuters reported last month, as the developer struggles to get back on better footing.
Its $22.7 billion worth of offshore debt including loans and private bonds is deemed to be in default after missing payment obligations late last year. It said in March that it will unveil a preliminary debt restructuring proposal by the end of July.
Late last year rating agencies including S&P downgraded Evergrande to “selective default” after missed offshore debt payment.
(Reporting by Sumeet Chatterjee; Editing by Kim Coghill)
