HONG KONG, July 29 (Reuters) - China's Huaibei Mining Holdings said on Wednesday its construction unit is suing indebted property developer Evergrande Group over an overdue 400 million yuan ($61.79 million) payment.
Huaibei Mining said in a filing Evergrande's project company in the eastern province of Anhui kept refusing to pay for the construction fee it owed Huaibei's construction unit, including a commercial paper Evergrande issued to the unit, citing lack of money, despite six requests for repayment. Evergrande did not immediately respond to a request for comment.
Huaibei's construction unit signed a contract with Evergrande's project company in November 2018 and has completed the construction work, according to the filing, though it did not state the maturity date of the commercial paper.
Commercial paper, which is not counted as interest-bearing debt, is commonly used in the property sector as a payable that promises construction suppliers a payment on a future fixed date, usually within one year.
Worries over the developer's financial health intensified after Evergrande admitted in June its project companies had not paid some commercial paper on time, but it was arranging payment.
The developer is the biggest issuer of commercial papers in the country. Its flagship unit, Hengda Real Estate Group, had 205.7 billion yuan ($32 billion) worth of commercial paper at the end of 2020, 24% higher than 2019 and 390% higher than 2015, filings showed.
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