China Evergrande to sell shares in China's Netflix amid default woes

© Kyodo News

Debt-laden property developer China Evergrande Group said Thursday that it would sell all its shares in streaming company HengTen Networks Group, known as China's Netflix, to an investment firm for HK$2.1 billion ($269.6 million).

The move comes as Evergrande, whose liabilities have swelled to around 2 trillion yuan ($310 billion), has continued to sell its assets, such as an electric vehicle-related group company, in a bid to raise funds to make coupon payments on dollar-denominated bonds.

But it is still uncertain whether Evergrande, which owns a popular soccer club in China, can completely avoid default risk, given that it must keep making massive interest payments on other bonds, sources close to the matter said.

There remains concern that a potential bankruptcy of Evergrande may spark an event comparable to the 2008 global financial crisis, triggered by the collapse of U.S. securities firm Lehman Brothers Holdings Inc.