China EV war: Evergrande raises US$3.35 billion in plan to dominate Tesla, NIO and other home rivals
- Company to sell 952.4 million new shares to six Hong Kong and mainland tycoons at a 9 per cent discount to Friday’s closing price
- Stock has risen 307 per cent over the past 12 months despite huge losses in recent years
China Evergrande is taking a step further in its ambitious plan to conquer the global electric vehicle (EV) market by making one of its biggest fundraisings yet from six private investors since switching its focus from the health care business in 2018.
China Evergrande New Energy Vehicle Group, the developer’s Hong Kong-listed unit, is raising HK$26 billion (US$3.35 billion) selling 952.4 million new shares at HK$27.30 each, according to a Hong Kong stock exchange filing on Sunday. The price represents a 9 per cent discount to the last traded level on Friday, and the stake amounts to about 9.75 per cent of its enlarged capital.
The company’s shares have risen 307 per cent over the past 12 months, giving it a market value of about US$34 billion despite incurring huge losses over the past two years. The other four investors who have agreed to take up HK$5 billion each in the stock placement include businessmen from its home base Shenzhen.
China Evergrande NEV intends to spend the money on technology research and development, production of new energy vehicle business and repay older debt, it said in the filing.