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In the sights of the authorities: The billionaire and Evergrande boss Hui Ka Yan at an appearance in 2017

Photo: Bobby Yip / REUTERS

The CEO of the ailing Chinese real estate group China Evergrande has apparently been placed under police surveillance. As reported by Bloomberg News, citing people familiar with the matter, Hui Ka Yan was taken away by police earlier this month and is being monitored at a fixed location. The Reuters news agency could not immediately verify the Bloomberg report, Evergrande did not comment on it at first.

Hui Ka Yan founded Evergrande in 1997, and his personal fortune was estimated by Bloomberg at a good six billion US dollars in 2021. According to the report, it is unclear why Hui was placed under residential supervision. It is a type of police action that does not equate to a formal arrest or arrest and does not mean that Hui is charged with a crime.

Earlier this month, police in southern China arrested some employees of Evergrande's asset management unit. That points to a new investigation that could exacerbate the real estate giant's problems.

Evergrande has accumulated more than $300 billion in debt and has repeatedly defaulted on interest on foreign bonds. The group has thus become a symbol of the crisis-ridden real estate industry in China.

Shares of the company had lost nearly 25 percent of their value since Monday, after Evergrande said a day earlier that it could not issue new bonds as part of its debt restructuring plans due to a regulatory investigation into its main Chinese entity. On Wednesday, however, Evergrande shares jumped nearly four percent in early trading.