HONG KONG: Shares of China Evergrande plunged as much as 24% on Monday after the embattled developer said it was unable to issue new debt due to an ongoing investigation into one of its subsidiaries, dealing a fresh blow to its restructuring plans. "In view of Hengda Real Estate Group Co Ltd, a principal subsidiary of the company, being investigated, the group is unable to meet the qualifications for the issuance of new notes under the present circumstances," Evergrande said in a statement late on Sunday.

In August, Hengda Real Estate said it was being investigated by China's securities regulator for suspected violation over the disclosure of information.

The development opens a new front for the world's most indebted company just a week after police detained some staff at its wealth management unit, sending its shares slumping and piling more pressure on Evergrande's restructuring plans.

Shares of Evergrande, which has more than $300 billion in liabilities, fell as much as 23.6% to HK$0.42, in a broader market down 0.6%.

Earlier this month, Evergrande said it had delayed making a decision on offshore debt restructuring from September to next month to allow holders of its debt more time to consider its proposal.

Evergrande needs approval from more than 75% of the holders of each debt class to approve the plan, which offers creditors a basket of options to swap debt for new bonds and equity-linked instruments backed by its stocks and those of its Hong Kong-listed units.

Prominent developers such as Country Garden Holdings continue to teeter close to default, keeping home-buyer sentiment depressed and prompting Beijing to implement a raft of measures to prop up the sector and spur property demand.

The crisis in the property sector, which accounts for roughly a quarter of the world's second-largest economy, has roiled global markets, with moves by Beijing to bolster the industry appearing to have little impact so far.

As of the end of August, the combined floor area of unsold homes stood at 648 million square metres (7 billion square feet), the latest data from the National Bureau of Statistics (NBS) show. (Reporting by Donny Kwok, Writing by Anne Marie Roantree; Editing by Muralikumar Anantharaman and Lincoln Feast.)