A winding-up petition against defaulted developer Country Garden Holdings Co. is highlighting the risks posed by secretive private loans on distressed Chinese property firms.
The builder, which is at the epicenter of China’s property debt crisis, is facing a petition filed by Ever Credit Ltd. after it failed to repay a term loan facility of about HK$1.6 billion ($204 million), plus accrued interest. The borrowing represents a fraction of Country Garden’s outstanding offshore bonds which total about $10 billion, according to data compiled by Bloomberg.