Chinese property developer Longfor Group opened nearly 15% down in Hong Kong and slumped as much as more than 40% at one point, its biggest one-day drop on record.
The sell-off came after the company’s billionaire Chairman Wu Yajun stepped down, underscoring investor concern about the health of the company, marking the first time for the company to change its chairman in 29 years.
Longfor Group Holdings Ltd.’s dollar bonds slumped in early trading, while its shares fell as much as 45% as of 9:38 a.m. Its 4.5% bond due 2028 plunged 12.6 cents on the dollar to 20.1 cents.
Its onshore bond due February 2024 tumbled by more than 23% on the Shanghai Stock Exchange before the trading was temporarily suspended due to “abnormal fluctuation.”
At a meeting with investors on Sunday, Wu said that “she had originally planned to step down around mid-year, but as Longfor experienced heavy short selling in early August and property sales didn’t returned to growth, therefore the move has been delayed. “
“There is nothing particular to worry about the timing of the move, the company plans to arrange some advance debt repayment,” she said, adding that “It’s very safe.”
Other property developers are also sliding, with Greentown China down more than 17%, Times China down more than 9%, Country Garden down nearly 9% and Yuexiu Property down nearly 7%.
