China Evergrande’s EV unit surges 87% as potential buyers eye control of cash-strapped carmaker
- The liquidators of China Evergrande reached an initial agreement on May 16 to sell a 29 per cent stake in Evergrande NEV to an unidentified buyer
- Production at Evergrande NEV’s Tianjin factory has been suspended since the beginning of the year
China Evergrande New Energy Vehicle Group (Evergrande NEV), the electric-vehicle (EV) manufacturing unit of insolvent property developer China Evergrande Group, surged in Hong Kong after the liquidator of its parent found a buyer for a stake in the listed arm.
The stock jumped 87 per cent to HK$0.71 on Monday, as trading resumed after being suspended over the past week. It extended a 53 per cent jump on May 17, when the shares were last traded.
The proposed stake sale may trigger a general offer for Evergrande NEV’s shares under the listing rules, the statement said.
A funding shortage has hit the EV maker, with production at its Tianjin factory suspended since the beginning of the year, according to the statement.
Trading in shares of China Evergrande has been suspended since January 29, when the stock closed at HK$0.163, after losing 99 per cent of its value over the past four years. It had combined liabilities of US$332 billion as of June last year, making it potentially the world’s most indebted developer.