Some of heavily-indebted China Evergrande Group’s lenders have seized over $60 million in shares held by the group’s chair Hui Ka Yan, after the struggling property developer formally defaulted on a bond for the first time, reports the Financial Times. Investors who lent to Hui took control of and then sold 278 million shares in Evergrande, which the executive pledged as collateral for borrowings.
The forced sales, which began on Monday, reduced Hui and his wife’s stake in Evergrande to 65.77% down from 67.87%, filings made in Hong Kong showed. The shares were worth $63 million at Friday’s closing price.
Hui has faced a barrage of criticism online in China, with retail investors demanding the billionaire property developer divest his private jets and luxury homes to pay off some of the group’s $300bn worth of liabilities.
The Evergrande chair earlier sold more than 1 billion shares in the property group to raise cash between October and November.