China Evergrande EV unit to issue fresh shares in restructuring plan
- China Evergrande New Energy Vehicle Group (NEV) will issue an aggregate of 5.44 billion new shares in the unit for HK$3.84 per NEV share
- The fresh issue is intended to pay off loans of NEV due against China Evergrande and its founder Hui Ka Yan
Embattled property developer China Evergrande Group said on Monday its listed electric-vehicle (EV) arm has agreed to issue new shares to certain subscribers to ease the loan burden and improve liquidity as part of its restructuring proposal.
Under the terms, China Evergrande New Energy Vehicle Group (NEV) will issue an aggregate of 5.44 billion new shares in the unit for HK$3.84 per NEV share, pooling an amount of HK$20.89 billion (US$2.67 billion).
The fresh issue is intended to pay off loans of NEV due against China Evergrande and its founder Hui Ka Yan, and his unit Xin Xin (BVI) Ltd, among others.
About 4.18 billion NEV shares to be issued to China Evergrande will be deposited into custody accounts under the mandatory exchangeable bonds (MEB) into NEV shares as well as the NEV Linked New Notes A2 and NEV Linked New Notes C2 to be issued by the company to its creditors.
The 690.1 million shares to be issued to Evergrande’s founder will be deposited into a custody account and used as exchange property for MEB.
In a separate announcement, NEV said it has agreed to issue 6.18 billion new shares to US-listed NWTN for a total consideration of HK$3.89 billion, implying a subscription price of HK$0.6297 per share.