Evergrande’s EV unit to raise $346m for vehicle production
08:02, 22 November 2021
Shares in China Evergrande New Energy Vehicle Group erased early losses to trade higher by Monday afternoon after the company announced a discounted share placement to raise HKD2.7bn ($346.5m).
Debt-ridden property developer Evergrande’s electric vehicle unit said it intends to use proceeds from the placement for research and development and production of new energy vehicles, “paving the groundwork for putting Hengchi new energy vehicles into production.”
The company said late on Friday that it will place 900 million shares at HKD3 per share.
Share price rebounds
The placing price of HKD3 per share represents a discount of 15% to its last close of HKD3.53.
Shares in the company fell as much as 3.1% by lunch break on Monday but recovered in the afternoon to trade 2.6% higher at HKD3.62.
Net proceeds after deducting all costs and expenses incurred is expected to be about HKD2.64bn, the company added.