After China Evergrande Group’s delisting and court-ordered liquidation, liquidators are actively seeking buyers for its remaining assets. Evergrande Property Services (06666.HK) disclosed that it has signed confidentiality agreements with potential buyers, and received non-binding offers.
On September 11, Evergrande Property Services announced that China Evergrande’s liquidators had signed confidentiality agreements with relevant potential buyers of Evergrande Property Services. On September 9, the liquidators received non-binding acquisition offers from some interested buyers.
The company did not disclose the specific identities of the potential buyers, nor did it reveal any details about the transaction valuation. It only said in its announcement that the deal is still at a preliminary stage, and after shortlisting potential buyers, China Evergrande’s liquidators will negotiate transaction terms with them around November 2025.
Evergrande Property Services was established in 1997, initially providing property management services for real estate projects developed by China Evergrande’s subsidiary, Evergrande Real Estate. At the end of July 2020, China Evergrande announced the spin-off of its property management arm, and on December 2 of the same year, Evergrande Property Services was listed on the Hong Kong Stock Exchange.
The controlling shareholder of Evergrande Property Services is China Evergrande. At the time of listing, China Evergrande directly and indirectly held 59.04% of Evergrande Property Services’ shares; currently, its shareholding has fallen to 51.02%.
An executive at a property management company said that in the current property M&A market, acquirers focus on indicators such as the target company’s cash flow, profit, debt, project risks, and team situation, and they also look at the ratio of the company’s annual contracted revenue to its actual revenue.
The executive noted that the fact that Evergrande Property Services has issued an announcement indicates that the buyer and seller have essentially reached consensus on the transaction price, and the buyer has already completed due diligence and is aware of Evergrande Property Services’ key financial and operational metrics.
China Evergrande’s liquidity pressures surfaced in early 2021. On August 10 of that year, the company put part of its property management arm’s shares on the market. In early October 2021, various sources disclosed that Hopson Development (00754.HK) intended to acquire about 50.10% of Evergrande Property Services’ shares, with a proposed consideration of about HK$20.04 billion, corresponding to a valuation of Evergrande Property Services at around HK$40 billion. However, just half a month later, the deal abruptly fell through.
On September 11, 2025, Evergrande Property Services announced a one-day trading halt. One day earlier, the company’s total market capitalization was only about HK$9.946 billion, a drop of about 95% from its peak of HK$206.471 billion, and about a 75% decline compared to its valuation at the time of Hopson’s proposed acquisition in 2021.
On December 3, 2021, China Evergrande defaulted on its obligations related to a guarantee for a $260 million private bond, triggering cross-defaults on all its outstanding US dollar bonds. At that time, the market still regarded Evergrande Property Services as one of the relatively higher-quality assets within the Evergrande system that might help China Evergrande mitigate risks.
However, on March 21, 2022, Evergrande Property Services revealed that about RMB 13.4 billion in deposits had been forcibly seized by banks.
On July 22, 2022, China Evergrande and Evergrande Property Services released preliminary investigation results, saying that from mid to late December 2020, due to its own funding needs, China Evergrande selected Evergrande Property Services as the pledgor to provide collateral guarantees for a third-party company’s bank financing. After deducting expenses, the loan proceeds were transferred back to China Evergrande and its subsidiaries via the third party. When the pledge guarantee expired, the borrower failed to make repayment on time, and the certificates of deposit pledged by Evergrande Property were therefore forcibly executed.
The credibility of Evergrande Property Services’ value was questioned following the deposit pledge seizure incident. After Hopson’s failed acquisition, there was no further progress on selling its shares.
On March 22, 2023, China Evergrande announced a preliminary offshore debt restructuring plan, with Evergrande Property Services included as one of the entities for potential debt-to-equity swaps. At that time, China Evergrande and its financial advisors also sought to inject liquidity into Evergrande Property Services through introducing strategic investors and maintaining operations, aiming to support China Evergrande’s offshore debt restructuring plan.
However, in September 2023, the China Securities Regulatory Commission launched an investigation into China Evergrande’s domestic real estate subsidiary Evergrande Real Estate, and the company’s chairman, Xu Jiayin, was placed under criminal coercive measures. China Evergrande’s offshore debt restructuring then fell into difficulties. On January 29, 2024, the Hong Kong High Court issued a winding-up order against China Evergrande. Thereafter, the liquidators took control of CEG Holdings (BVI) Limited, the offshore subsidiary through which China Evergrande held the majority of Evergrande Property Services’ shares.
Of note, China Evergrande’s announcement on August 12, 2025, showed that as of the end of July 2025, the total offshore creditor claims received by the liquidators had reached as high as $45 billion (about RMB 323.2 billion). Over the past year, the liquidators sold off China Evergrande’s non-core offshore assets and actively recovered various receivables, with proceeds totaling only about $255 million.
This amount was a mere drop in the bucket, and China Evergrande’s liquidators are still trying to raise funds. In the announcement on September 11, Evergrande Property Services said that the liquidators have been seeking opportunities to sell China Evergrande’s 51.02% stake in Evergrande Property.
In the first half of the year, Evergrande Property Services achieved revenue of about RMB 6.647 billion, a year-on-year increase of about 6.9%; net profit was about RMB 491 million, a decline of 1.8%. Of this, revenue from related parties accounted for only about 0.31%, while revenue from third-party companies accounted for 99.68%. Evergrande Property Services’ related parties mainly comprise China Evergrande’s subsidiaries and joint ventures.
Affected by China Evergrande, Evergrande Property Services’ operating fundamentals remain under significant pressure. In its financial report, the company noted that based on prudence principles, it excluded revenue related to vacant property management for Evergrande projects when calculating revenue, amounting to RMB 229 million.
Evergrande Property Services also said that the company has contracted projects totaling 150 million square meters with Evergrande-related entities, but their conversion has stalled, and whether they can be effectively converted in the future remains highly uncertain. Furthermore, the disposal of assets by related parties may lead to changes in Evergrande Property’s related businesses, such as parking lot operations, and the transmission of related-party risks has also severely undermined Evergrande Property’s brand credibility and bargaining power in the external market.
As of the end of June 2025, Evergrande Property Services’ trade receivables stood at about RMB 5.883 billion, an increase of RMB 575 million from the end of 2024. Among these, trade receivables from related parties were about RMB 2.199 billion, almost all provisioned for impairment. It said that due to various factors related to related parties, some property owners’ willingness to pay fees has weakened, leading to rising receivables and extended collection periods.