{"id":21545,"date":"2023-04-25T05:38:15","date_gmt":"2023-04-25T05:38:15","guid":{"rendered":"http:\/\/lynettelockhart.com\/client\/china-evergrande-unit-to\/"},"modified":"2023-04-25T05:54:30","modified_gmt":"2023-04-25T05:54:30","slug":"evergrande-ev-unit-set","status":"publish","type":"post","link":"http:\/\/lynettelockhart.com\/client\/evergrande-ev-unit-set\/","title":{"rendered":"Evergrande EV unit set for $3.6 billion gain from liability transfer"},"content":{"rendered":"<p>(Reuters) -Embattled property developer China Evergrande Group said its listed electric vehicle arm will book a $3.6 billion gain from the transfer of two debt-laden companies to another group unit as part of the auto firm&#8217;s restructuring.<\/p>\n<p>With more than $300 billion in total liabilities including offshore debt, Evergrande has been at the centre of a property debt crisis in which multiple Chinese developers defaulted over the past year.<\/p>\n<p>Evergrande has touted the EV arm as key to its transformation plans. Chairman Hui Ka Yan vowed last year to shift the group&#8217;s primary business within 10 years from real estate to the automobile venture, and to make 1 million vehicles a year by 2025.<\/p>\n<p>The restructuring, published in an Evergrande Group filing late on Monday, comes as the EV subsidiary, also known as Evergrande Auto, struggles with a funding crunch with production of its Hengchi 5 model, a crossover SUV, suspended at its Tianjin-based facilities.<\/p>\n<p>Under terms of the deal, China Evergrande New Energy Vehicle Group will record a gain of about 24.79 billion yuan ($3.59 billion) following the sale of the entire issued share capital of its Flaming Ace Ltd and Assemble Guard Ltd businesses to investment business Anxin Holding for a nominal consideration of 2 yuan.<\/p>\n<p>In a separate filing, Evergrande Auto said Assemble Guard and Flaming Ace, which hold 47 property projects altogether, as of end-2022 reported a net liability of 24.79 billion yuan and post-tax net loss of 8.82 billion yuan. It added in the filing it does not expect to receive any net proceeds from the transfer.<\/p>\n<p>Evergrande said the move, which will allow Evergrande Auto to focus on the new energy vehicle (NEV) segment, could help improve the EV subsidiary&#8217;s valuation and eventually &#8220;may help to attract investors to Evergrande Auto and raise funds&#8221;.  <\/p>\n<p>The auto business said it can take its NEV segment to the next stage of growth by &#8220;de-leveraging and reducing its holding of the projects&#8221;.<\/p>\n<p>The parent company announced a proposal last month to restructure its $22.7 billion of offshore debt, which gave creditors a basket of options to swap their debt into new bonds and equity-linked instruments backed by the group and its two Hong Kong-listed companies, Evergrande Auto and Evergrande Property Services Group.<\/p>\n<p>($1 = 6.9016 Chinese yuan renminbi)<\/p>\n<p> (Reporting by Riya Sharma in Bengaluru, Roxanne Liu in Beijing and Clare Jim in Hong Kong; Editing by Shounak Dasgupta, Devika Syamnath and Kenneth Maxwell)<\/p>\n<p><a href=\"http:\/\/lynettelockhart.com\/client\/china-evergrande-unit-to\/the-china-evergrande-centre-building-sign-is-seen-in-hong\/\"><img decoding=\"async\" src=\"http:\/\/lynettelockhart.com\/client\/wp-content\/uploads\/Reuters_Direct_Media\/USOnlineReportBusinessNews\/tagreuters.com2023binary_LYNXMPEJ3N0FY-VIEWIMAGE.jpg\" alt=\"tagreuters.com2023binary_LYNXMPEJ3N0FY-VIEWIMAGE\"><\/a><\/p>\n","protected":false},"excerpt":{"rendered":"<p>(Reuters) -Embattled property developer China Evergrande Group said its listed electric vehicle arm will book a $3.6 billion gain from the transfer of two debt-laden companies to another group unit as part of the auto firm&#8217;s restructuring. With more than $300 billion in total liabilities including offshore debt, Evergrande has been at the centre of [&hellip;]<\/p>\n","protected":false},"author":8,"featured_media":21546,"comment_status":"closed","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"spay_email":"","footnotes":""},"categories":[1213],"tags":[1223],"class_list":["post-21545","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-u-s-business","tag-updated"],"jetpack_featured_media_url":"http:\/\/lynettelockhart.com\/client\/wp-content\/uploads\/Reuters_Direct_Media\/USOnlineReportBusinessNews\/tagreuters.com2023binary_LYNXMPEJ3N0FY-VIEWIMAGE.jpg","_links":{"self":[{"href":"http:\/\/lynettelockhart.com\/client\/wp-json\/wp\/v2\/posts\/21545","targetHints":{"allow":["GET"]}}],"collection":[{"href":"http:\/\/lynettelockhart.com\/client\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"http:\/\/lynettelockhart.com\/client\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"http:\/\/lynettelockhart.com\/client\/wp-json\/wp\/v2\/users\/8"}],"replies":[{"embeddable":true,"href":"http:\/\/lynettelockhart.com\/client\/wp-json\/wp\/v2\/comments?post=21545"}],"version-history":[{"count":2,"href":"http:\/\/lynettelockhart.com\/client\/wp-json\/wp\/v2\/posts\/21545\/revisions"}],"predecessor-version":[{"id":22236,"href":"http:\/\/lynettelockhart.com\/client\/wp-json\/wp\/v2\/posts\/21545\/revisions\/22236"}],"wp:featuredmedia":[{"embeddable":true,"href":"http:\/\/lynettelockhart.com\/client\/wp-json\/wp\/v2\/media\/21546"}],"wp:attachment":[{"href":"http:\/\/lynettelockhart.com\/client\/wp-json\/wp\/v2\/media?parent=21545"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"http:\/\/lynettelockhart.com\/client\/wp-json\/wp\/v2\/categories?post=21545"},{"taxonomy":"post_tag","embeddable":true,"href":"http:\/\/lynettelockhart.com\/client\/wp-json\/wp\/v2\/tags?post=21545"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}