(Yicai Global) May 15 -- Embattled property developer China Evergrande Group said it has been ordered to pay CNY6 billion (USD861.6 million) in compensation following a dispute with one of its investors. 

The claimant, Hexin Hengju Shenzhen Investment Holding Center, had demanded that Evergrande and Executive Director Xu Jiayin, buy back its equity interest in Evergrande Real Estate for CNY5 billion and pay the outstanding liquidated damages and dividends totaling about CNY1 billion. 

The Guangzhou Intermediate People’s Court decided in favor of the claimant and issued an enforcement notice to Evergrande, the Shenzhen-based developer said on May 12.

In 2016, Evergrande launched a restructuring program for its subsidiary Evergrande Real Estate in partnership with Chinese mainland-listed Shenzhen Special Economic Zone Real Estate and Properties, to seek a secondary listing in the mainland market.

To implement the restructuring, Evergrande raised CNY130 billion (USD18.7 billion) in strategic investment for Evergrande Real Estate, including CNY5 billion from the claimant in return for a roughly 1.6 percent stake.

But the restructuring was not completed within the agreed period of four years, and investors were entitled to ask Evergrande to repurchase the equity interest if the restructuring failed, according to the agreement. The property giant announced in November 2020 that it had reached long-term agreements with most of the investors affected.

Evergrande has seen mounting financial difficulties since the second half of 2021, with debt defaults amid a tight financing environment for developers. Its liabilities reached CNY1.9 trillion (USD272.8 billion) by the end of 2021, while assets totaled only CNY1.7 trillion, according to the latest data released by the company.

Editors: Dou Shicong, Tom Litting