The seriously indebted real estate developer, China Evergrande Group, was order to be liquidated by a Hong Kong court on Monday, China Media Group (CMG) reported.

Previously, the proceedings of liquidation petitions were adjourned multiple times.

According to CMG, the court said that China Evergrande's debt restructuring plan had failed to make progress, while the company remained insolvent, and at the request of its creditors, the court formally ordered China Evergrande to wind up.

Before the court hearing, the debt-ridden company’s shares plunged as much as 20 percent. Company-related stocks including China Evergrande Group and Evergrande New Energy Vehicle Co Ltd halted trading at the local market.

The liquidation petition by creditors is a common means of debt recovery under the Hong Kong legal system. By issuing a liquidation order, the court declares the company to be in insolvent. 

In response, Xiao En, Evergrande CEO, said on Monday that the company will take all legal and compliant measures to ensure the normal operation of the group's business under the premise of safeguarding the legitimate rights and interests of creditors both at home and abroad. 

Meanwhile, the group will also actively communicate and cooperate with the liquidator in accordance with the law in the fulfillment of the relevant procedures, and push forward debt settlement and other work in accordance with the international practice and the rules of the market.

Xiao noted that the subject involved in the liquidation order issued by the Hong Kong court is China Evergrande Group, which is listed in Hong Kong. At present, the management and operation of Evergrande and its subsidiaries as independent legal entities will remain unchanged. The group will continue to endeavor to safeguard the stability of its business operations, push forward the key work of guaranteeing the delivery of residential housing and maintaining the quality of property services , as well as make every effort to seek final resolution of risks and the disposal of company assets.

In June 2022, the company’s creditors first petitioned the court to be liquidated. Since then, it has filed eight applications for adjournment of the petition hearing.

In September 2023, Hui Ka Yan, the founder of China Evergrande Group was placed under mandatory measures in accordance with the law on suspicion of committing crimes, the company said in a filing it sent to Hong Kong Stock Exchange then.