China Evergrande Group and some of its biggest offshore creditors have reached agreement on moving restructuring talks forward, helping stave off their threats of taking over the company’s offshore businesses after $2 billion in offshore cash was seized by banks, WSJ Pro Bankruptcy reported. Evergrande agreed in principle late last week to pay bondholders’ advisory fees, provide additional due diligence on the company’s financial health, and give creditors a formal role in the restructuring process. The fee- and information-sharing agreement is seen as a moderate step in the right direction rather than substantial progress to restructure Evergrande’s debt. Bondholders appear to be changing tack after they threatened to sue Evergrande in January for allegedly stonewalling discussions with them. Tensions simmered again after Evergrande disclosed in March that banks had taken control of more than $2 billion held by one of its key subsidiaries. Evergrande reached out to an organized committee of foreign bondholders soon after the beginning of the Chinese Lunar New Year to move talks along. The discussions first focused on reaching an agreement over paying creditors’ advisory fees, until Evergrande disclosed the $2 billion cash seizure at its Hong Kong-registered property management arm.
