Evergrande EV unit falls after selling $347m in shares

by BLOOMBERG  

CHINA Evergrande Group’s electric-vehicle unit fell after selling HK$2.7 billion ($347 million) in shares at a discount to bolster its finances as it seeks to put delayed vehicles into production. 

China Evergrande New Energy Vehicle Group Ltd. sold 900 million shares at HK$3 each, 15% below the Friday closing price in Hong Kong, according to a statement from the Guangzhou-based company. 

The stock, representing 9% of the firm, was sold to at least six investors, the company said. 

The shares fell to HK$3.49 in early trading after the sale, which adds to the $64 million it raised on Nov 10. 

Evergrande NEV warned as recently as September of a serious funds shortage, echoing some of the financial troubles faced by its parent company. 

The start-up said it had suspended paying some of its operating expenses and suppliers had stopped work, stoking concern it wouldn’t be able to start mass production of its long-awaited electric vehicles. 

At its peak, Evergrande NEV was one of the most valuable assets in Evergrande founder Hui Ka Yan’s empire, and a potential source of funds to prop up the developer. 

The stock has plunged from a record high of HK$72.25 in February, before a selloff as the unit’s parent company battled to ease a liquidity

crisis.