An agreement to sell $2.6bn of the most indebted firm in property to a competitor company failed.

Evergrande Group, China’s property giant, has suspended its shares due to an “announcement containing inside information regarding a major transaction.”

Hopson Development, a real estate company, was reported to be looking for a 51% share in the property services division.

The trading stopped for two weeks by both firms. However, they will resume trades on Thursday following the breakdown of their agreement.

Evergrande’s crisis has raised fears of a global market collapse.

Investors have concerns about its more than $300bn (£222bn) of debt.

Shares of the firm fell by almost 80 percent since this year’s start. China’s GDP is approximately 2%.

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In separate filings, the parties stated that they could not agree upon the terms of their deal.

Hopson Development stated that Evergrande informed it of the termination on October 13.

Hopson stated that the company was exploring all options to protect its legitimate rights in connection to the Agreement.

Hui Ka Yan (chairman and founder of Evergrande Group) stated that after the deal collapsed, the company would make every effort to reach an agreement with its creditors for the extension or renewal of their borrowings.

He said that there is no assurance the group would be able meet the financial obligations listed in the financing documents or other contracts.

The group would suffer materially adverse effects on its business, prospects and financial health if it fails to pay its guarantee obligations or repay its debts on time.

Evergrande has had difficulty making payments in recent weeks to its investors for bonds and wealth-management products.

In September, the property industry giant was reportedly insolvent and missed twice interest payments to investors overseas.

Company has begun to take steps to recover money it owes to investors, customers and suppliers. It previously claimed that it sold $1.5bn of its stake in a commercial bank.

Source: BBC.com

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