In its latest bid to avert bankruptcy, China’s Evergrande Group is planning its biggest ever asset sale, as it looks to sell a majority stake in its asset management business for an estimated $5 billion, Reuters reported.

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According to the Chinese company that was once known as the world’s most valuable real estate brand, brand finance, continued to offload assets in an effort to avoid succumbing to its $305 billion in debt.

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On Monday, the company asked to halt trading of its shares in Hong Kong as it planned to announce a major transaction. Evergrande Property Services Group, the company’s spinoff management wing, also requested a halt in business.

global times, A newspaper controlled by the Chinese Communist Party later reported that Hopson Development, one of China’s five largest real estate companies, was ready to buy a 51 percent stake in Evergrande’s property services group. Hopson also asked to suspend trading of its shares, because it would be “a major takeover of the Hong Kong-listed firm”, according to Reuters.

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Reports indicated that Evergrande is facing liquidity problems. The sale of this asset, which follows the sale of its stake in a Chinese bank, showed Evergrande is looking for ways to stay afloat, according to Overseas-Chinese Banking Corporation (OCBC) analyst, Aizen Hu.

“Selling a property means they are still trying to raise cash to pay the bills,” Hu told Reuters. “It seems like in the grand scheme of things the asset management unit is the easiest to dispose of.”

The asset management arm of Evergrande represents about 3,000 properties and employs approximately 6,000 employees, according to its website. Reuters reported that financial statements for the first half of 2021 showed it to be profitable.

While selling the firm may provide a solution in the short term to the company’s cash flow issues, Evergrande is facing overall financial issues as its share price continues to decline and it is unable to complete unfinished construction projects. is unable.

“This is certainly a positive step towards solving Evergrande’s liquidity crisis and we expect more to come,” said Gary Ng, senior Asia Pacific economist at Natixis. “While having said that, offloading some assets may not be entirely sufficient, the key to Evergrande is to build the project and sell off the inventory.”

Reuters reported that many Chinese homeowners fear their property could be at stake if Evergrande succumbs to its debt and leaves its projects unfinished. The company, which stands as China’s second-largest developer, could reduce the value of Chinese real estate and affect the country’s citizens’ net worth.