China Evergrande Group has begun to repay some of its outstanding debt from buyers of investment products. Earlier, they protested for weeks against missed payments by the debt-plagued project developer.
A debt of 260 billion euros burdens Evergrande. It transferred the first 10 percent of the money to be transferred this month related to its asset management products. The money has been deposited into investors’ accounts, the company said in a statement.
The cash refund is one of three options Evergrande offered earlier this month to woo angry buyers of these high-yield products. The other options were payment in kind with heavily discounted properties instead of cash or settling the debts against outstanding bills on housing units already purchased. The group said that a full cash repayment must be completed in steps within two and a half years.
The fact that Evergrande failed to meet a payment obligation for 40 billion yuan, converted approximately 5.4 billion euros, caused anger across the country. Private investors took to the streets to protest.
More than 70,000 people bought the products, including many Evergrande employees. The developer, in need of money, knocked on their door for financing. To prevent further unrest, pressure is also increasing on Beijing to find a solution.