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29 Sept 2021

Evergrande to Sell 20% Shengjiang Bank Stake to Investment Group

The Index Today

China Evergrande Group announced it will sell a 20% stake worth CNY10 billion in Shengjiang Bank Co Ltd to the state government.

This announcement led to the developer’s shares rising by 9.36% to HK$2.92. According to news released by the Hong Kong Stock Exchange, 1.75 billion worth of non-publicly traded domestic shares will be sold at CNY5.7 Yuan a piece. Shengjiang bank was untraded at HK$7 at closing on Tuesday.

Evergrande’s dollar bond which is due in 2022 went down at 25.3 cents on the dollar whereas the 2025 note remained the same at 23.5 cents. This information was published by Bloomberg. Upon the completion of the transaction, Evergrande shares in Shengjiang will drop to 14.57%. Recently, the company had sold a stake in August 2021 where the lender gained around CNY1 Billion.

The debt-ridden developer has been under much pressure lately to see assets and pay off looming debt. The stake it owned in Shengjiang Bank was among some of its most valuable assets worth over $2 billion. It is expected that the sale of shares may help ease the financial situation of Evergrande.

©Photo: Reuters

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