The China Evergrande Centre building sign is seen in Hong Kong, China December 7, 2021. REUTERS/Tyrone Siusaid 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's restructuring.
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.will record a gain of about 24.79 billion yuan 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.
Evergrande said the move, which will allow Evergrande Auto to focus on the new energy vehicle segment, could help improve the EV subsidiary's valuation and eventually "may help to attract investors to Evergrande Auto and raise funds".
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