$313 Million Of Distressed Land Developer China Fortune’s Cash Apparently Just Disappeared Into Thin Air
A British Virgin Islands-registered firm called China Create Capital Ltd., that took $313 million from distressed Chinese land developer China Fortune Land Development Co., has apparently disappeared into thin air.
China Fortune has “lost contact” with the entity, according to a new report by Bloomberg, all but eliminating its prospects of yielding the 8% to 10% on the cash that it had planned on receiving annually through 2022.
A filing with the Shanghai bourse confirmed the loss of contact.
The developer said it has turned the matter over to the local police and it’s “unclear” how it will affect future earnings.
Fortune is the latest implosion for the Chinese real estate market, following Evergrande’s recent distress and Beijing’s policies aimed at deleveraging and de-risking the sector.
It defaulted on a $530 million bond this March, prior to the Evergrande story becoming a mainstream headline.
Fortune said an agreement signed in 2018 with an entity called Wingskengo Ltd. is at the genesis of the investment. The deal was supposed to help the developer buy fixed income products, Bloomberg reported.
Fortune Land transferred $313 million to China Create Capital as part of the agreement. Fortune subsequently booked it as a “non-current financial asset”.
Soon be a “never current” financial asset…
Thu, 12/16/2021 – 16:40