Is China’s biggest property developer truly too big to fail?

EARLY IN SEPTEMBER Evergrande, China’s biggest home-builder, announced the kind of sale more commonly seen in clothing stores: “30% off all properties, one month only!” Some debated whether it was a gimmick or a genuine discount. But its motivation was clear. Deep in debt, Evergrande needed cash—and quickly. Events since then have highlighted the urgency, and also raised the question of whether its struggles threaten the wider economy.

Evergrande, after all, has more debt—nearly $120bn—than any other non-financial listed company in China. Having built as many as 600,000 homes annually, it has amassed a debt load 56 times bigger than a decade ago. And it has strayed far from its core business, founding a colossal football academy, a bottled-water brand (which it later sold) and an electric-car company.