Another Chinese development company has financial problems

Another Chinese development company got into financial trouble. The medium-sized Fantasia Holdings Group on Monday did not repay a debt of USD 205.7 million (EUR 176.78 million). This will exacerbate the situation in this sector of Chinese industry, which has already been shaken by the threat of bankruptcy of the country's second largest developer, Evergrande. Evergrande, the country's most indebted private builder, is struggling with more than $ 300 billion in liabilities and is heading for a major restructuring. This raises concerns about the spread of the "contagion" in the Chinese economy. Shenzhen-based Fantasia Holdings announced in a statement issued through the Hong Kong Stock Exchange that it had missed the payment. It did not give any explanation. It merely stated that it had requested the suspension of trading in its shares. Some Chinese developers have problems repaying debt after regulators tightened limits on the use of credit money last year. Although Fantasia is smaller than Evergrande, its difficulties have exacerbated investors' fears of further collapse of Chinese companies. Fitch Ratings downgraded Fantasia to "CCC-" on Monday, a move that points to the possibility of bankruptcy. The news comes at a time when investors are waiting for information about Evergrande after it suspended trading in its shares on Monday until a "big transaction" is announced. Hong Kong real estate company Hopson Development Holdings plans to buy a 51 percent stake in Evergrande's real estate services division, according to media reports. The rating agency S&P Global Ratings downgraded another Chinese real estate company - Sinic Holdings - stating that its "ability to service its debts is almost exhausted". Sinic's boss made headlines last month, losing more than $ 1 billion as shares fell on fears of Evergrande.