(Yicai Global) July 13 -- China Evergrande Group has told Yicai Global that rumors circulating on social media that rival real estate giants China Jinmao Holdings and Vanke are targeting assets held by the heavily indebted Chinese property developer are untrue and it reserves the right to hold such rumor spreaders legally accountable.

Evergrande is planning to sell property assets to Jinmao and Vanke worth tens of billions of Chinese yuan, equivalent to billions of US dollars, according to rumors spreading on social media platforms such as WeChat. Hong Kong-based Jinmao is expected to buy between 30 and 40 premium projects, mainly in the Guangdong-Hong Kong-Macao Greater Bay Area, they added.

The hearsay likely stems from Shenzhen-based Evergrande’s efforts to slash debt by speeding up sales to meet recently imposed regulatory borrowing limits.

Last month, Chairman Hui Ka Yan said it will cut debt by 31 percent to CNY590 billion (USD92 billion) by the end of June from the record high reached at the end of last year. This will then be reduced to CNY450 billion by June 30 next year and to under CNY350 billion by June 30, 2023, he said.

In this way the developer will meet the ‘three red lines’ set up by regulators last year to mitigate risks in the real estate sector. These are a 70 percent upper limit of debt-to-asset ratio after excluding advance receipts, a 100 percent upper limit for net debt ratio and a one-to-one down limit ratio for cash against short-term debts.

Evergrande’s share price [HKG:3333] closed down 0.64 percent today at HKD9.28 (USD1.19).

Editor: Kim Taylor