China Evergrande New Energy Vehicle to issue new shares to several raise funding

 

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Embattled property developer China Evergrande Group said its electric vehicle unit arm has agreed to issue new shares to improve liquidity as part of its restructuring proposal.

The Hong Kong-listed China Evergrande New Energy Vehicle Group will issue 5.44 billion new shares, at a price of HK$3.84 per share, raising a total of HK$20.89 billion ($2.67 billion), and it’s 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 into NEV shares (MEB) 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, the EV unit 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.

To aid business recovery, NWTN (Zhejiang) Automobile and Evergrande New Energy Vehicle (Tianjin) signed a support deal for interest-free funding of RMB600 million.This funding will be used for the research and development, manufacturing, and sales services of vehicles under the group. On completion, NWTN will hold about 27.50% stake in the EV unit.