A Chinese billionaire, who was one of the country’s most wealthy and influential businessmen, has seen a 93 per cent dip in his fortune. Hui Ka Yan, the Chairman of China Evergrande Group was once worth $42 billion, which made him Asia’s second-richest person. However, his wealth has declined to $3 billion, Bloomberg Billionaire Index showed, as reported by CNN.
Hui started Evergrande in Guangzhou in 1996 and began picking up low price properties in small markets. Its first project was Jinbi Garden. Hui’s son Xu Zhijian, who holds an MBA from Tsinghua University, is a vice president at Evergrande. Despite the decline in Hui’s fortune, Evergrande still has over 800 projects in more than 280 cities and is battling to repay $300 billion in liabilities.
Evergrande first defaulted on dollar bonds in 2021 and has more than $16 billion of outstanding dollar notes. After missing several self-imposed deadlines to deliver a preliminary restructuring blueprint, it proposed a restructuring plan this week with two options, people familiar with the matter said. Its shares have been suspended for almost a year after the company failed to report 2021 results, and PwC resigned as its auditor on Monday.
Evergrande is the country’s most indebted developer with $300 billion in liabilities and has been at the heart of China’s real estate problems since 2021. To save his company, the billionaire also ended up selling his houses and private jets.
The company has about 200,000 employees, raked in more than $110 billion in sales in 2020 and owns more than 1,300 developments in more than 280 cities, the publication added. The company also failed to deliver its preliminary debt restructuring plan last year, stoking questions about its future, as per CNN.
In addition to his wealth declining, Mr Hui is also finding himself increasingly isolated politically, with the latest signal coming from the Chinese People’s Political Consultative Conference (CPPCC). CPPCC is an elite group comprising government officials and the biggest names in the business.
The businessman had been part of CPPCC since 2008 and of its elite 300-member standing committee since 2013. However, he was told not to attend the annual convention last year as his property empire became the biggest casualty of the nation’s credit crunch, reported Sydney Morning Herald. Not only that, he has now been excluded from the latest list of individuals who will form the CPPCC for the next five years.
“The CPPCC role is like an honorary reward that China gives to faithful business people to make contributions to the country. It’s not surprising at all that property tycoons like Hui, who created trouble in the property sector with their over-leveraging, are out of the list,”
Willy Lam, an adjunct professor at the Chinese University of Hong Kong who has authored several books about Chinese politics told Bloomberg.
2023 is a crucial year for Evergrande Group to fulfil its duty as an enterprise and deliver projects in every possible way,” the property magnate had said in a New Year message seen by Hong Kong-based newspaper South China Morning Post (SCMP).
“I believe we can complete our mission of delivery, repay various debts, eliminate the risks, and start a new chapter on survival, as long as all of our work together and never give up on resuming our construction, sales, as well as operations,” he had said.
The Bloomberg Billionaire Index further showed that China’s five richest property tycoons also lost about $65 billion combined in the past two years.
Chinese real estate magnate Hui Ka Yan has reportedly lost 93% of his wealth as his company Evergrande is on the verge of collapse, defaulting on $300 million in debts. Once the second richest man in Asia, the 64 year old billionaire’s personal fortunes have plunged from its peak of $42 billion to an abysmal $3 billion now, as per the Bloomberg’s Billionaire Index.
This is not only a personal setback for the billionaire but Hui Ka Yan has been isolated by the influential Chinese People’s Political Consultative Conference (CPPCC). The CPPCC is an elite group of the most influential people in China that includes government officials and big business tycoons.
Having been in the advisory body of the CPPCC since 2008 and its elite committee of 300 members since 2013, Yan has been for the first time not included in its recent list. Yan was once the richest and the most influential businessman in China.
According to pundits, this move by CPPCC shows a major shift in China’s politics that is seen dissing developers amid a real estate crisis and the corruption that the industry is grappling with. Within the last couple of years 5 richest real estate tycoons in China have suffered losses that exceed $65 billions. So Yan ain’t all alone.
Hui Ka Yan’s company Evergrande first defaulted on dollar bonds in 2021 and now has more than $16 billion in outstanding dollars. After not meeting its deadlines to deliver, PwC exited the venture as an auditor. To salvage Evergrande, Yan sold much of his folio including private jets and houses.
Chinese developers are suffering significantly due to the pandemic and also due to president Xi Jingping’s doctrine of “common prosperity”. The common prosperity drive is to see wealth redistributed. This has led to a crackdown on several industries.
Yan is a self made first generation billionaire who comes from a rural family, raised by paternal grandparents. His first gig was in a cement factory for two years after high school. Many billionaires in China have similar stories. If only socialism and capitalism and all the ’isms’ out there find balance and thrive together.
I essence, Hui Ka Yan is a highly successful businessman and real estate developer in China. He is the chairman of China Evergrande Group, one of the largest real estate developers in China. Under his leadership, the company has seen significant growth and expansion, with a strong emphasis on sustainable and eco-friendly developments.
Hui Ka Yan’s business acumen and strategic vision have been instrumental in the company’s success, making him one of the most influential figures in the Chinese real estate industry. Furthermore, he is known to be a philanthropist and has been active in various charitable causes. Overall, Hui Ka Yan is a respected and accomplished businessman who has made a significant impact in the Chinese real estate industry.
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