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Updated February 7th, 2024 at 10:45 IST

Alvarez & Marsal leads Evergrande overhaul with Tiffany Wong and Eddie Middleton at helm

Evergrande, once a symbol of China's property boom, faced default in 2021, prompting an investigation into its founder, Hui Ka Yan.

Reported by: Business Desk
China real estate
China real estate | Image:Shutterstock
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Evergrande restructuring duo: China Evergrande, the heavily indebted property developer, is undergoing an overhaul led by restructuring experts from Alvarez & Marsal (A&M). Tiffany Wong and Eddie Middleton, both managing directors at A&M, were appointed by a Hong Kong court following prolonged discussions with Evergrande's offshore creditors.

Evergrande's troubled legacy

Evergrande, once hailed as China's property market success story, now stands burdened by a staggering $300 billion in liabilities. The company's fall from grace was swift, culminating in a default on its offshore debt in 2021. Compounding its woes, Evergrande's founder, Hui Ka Yan, finds himself under investigation for alleged financial misconduct.

The task ahead for Wong and Middleton is Herculean: to navigate a labyrinthine network of creditors, authorities, and stakeholders in order to salvage Evergrande's future. Their expertise, honed during their tenure at KPMG, will be put to the test as they grapple with the monumental challenge of restructuring Evergrande's offshore debt or, alternatively, overseeing its intricate liquidation process.

China liaison strategy

Key to their strategy is leveraging their deep-rooted connections within China's regulatory landscape. Wong is primarily tasked with liaising with onshore authorities, while Middleton focusses on offshore matters. Their approach hinges on transparency, flexibility, and adept navigation of the political and legal intricacies inherent in China's corporate environment.

A&M's reputation for excellence and impartiality has garnered them favour with major investors in the region, particularly hedge funds, providing a solid foundation for their ambitious restructuring endeavours. With a sizeable team based in mainland China, A&M is uniquely positioned to navigate the complexities of Evergrande's situation.

Wong's emotional perspective

Middleton's illustrious career includes stints at KPMG and Houlihan Lokey's Asia Financial Restructuring Group, where he played instrumental roles in high-profile liquidation cases such as Lehman Brothers' Asia operations and Oasis Hong Kong Airlines. Meanwhile, Wong, with her background in business management and psychology, emphasises the emotional fortitude required to navigate the often turbulent waters of corporate restructuring.

Their appointment by the Hong Kong court comes after considerations ruled out the involvement of top accounting firms, including PwC, Deloitte, and KPMG, due to conflicts of interest.

(With Reuters Inputs)
 

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Published February 7th, 2024 at 10:40 IST

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