Evergrande EV unit shares rally after trading resumes
Shares of China Evergrande New Energy Vehicle Group rallied as much as 95 percent on Monday morning after the firm resumed trading following a share transfer. The company, which is the EV unit of embattled property developer China Evergrande, on Sunday said 29 percent of its shares, or 3.14 billion, were expected to immediately change hands after liquidators reached a preliminary agreement with an unidentified buyer. The deal, subject to due diligence, includes an option for the buyer to take an additional 29.5 percent of the shares, or about 3.2 billion. The market value of the total shares involved is about HK$2.41 billion, based on the HK$0.38 per share before the trading suspension on May 17. The agreement, according to a Hong Kong stock exchange filing on Sunday, also includes a possible credit line to be arranged by the buyer to finance the company’s ongoing operations and the development of its electric vehicle businesses. Shares of the EV unit rallied to HK$0.74 per share shortly after its trading resumption. The EV maker is faced with a severe shortage of capital, with its Tianjin factory having ceased production at the beginning of the year. It has been struggling since its parent firm got sucked into a property crisis in China in 2021. Trading in the shares of Evergrande remains suspended.