On Monday, shares of China Evergrande New Energy Vehicle Group (HK:3333) doubled after the company announced that the liquidator and major shareholder representatives had agreed to sell their shares in the electric vehicle (EV) manufacturer.
On the first trading day after resumption from suspension, the stock price of Evergrande's troubled EV division surged to HKD 0.81, up 113%, marking the highest since September 22, making it the biggest winner in the Hong Kong stock market. By the close of trading, the stock still rose by 79%.
The liquidators of Evergrande Group, Evergrande Health Industry, and Acelin Global signed a non-binding agreement, under which a third-party buyer would purchase 29% of the EV division's shares, with an option to buy an additional 29.5%. The EV division made this announcement on Sunday.
These three companies collectively hold 58.5% of the cash-strapped EV division, and its factory in the northern city of Tianjin has been idle since early 2024.
The EV division mentioned that the agreement also includes a credit line from the potential buyer to support its operations and business development.
Last week, China Evergrande's new energy vehicle unit said it had received a letter from a local administrative authority demanding the repayment of RMB 1.9 billion (USD 262 million) in subsidies and incentives.
Earlier this year, China Evergrande, the world's most indebted real estate developer, was ordered to liquidate for failing to provide a concrete restructuring plan. This came more than two years after its first overseas debt default.
