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Tencent, Sequoia to take stake in Evergrande New Energy Vehicle
Posted on Wednesday, 16 September 2020 11:07
China Evergrande Group is introducing new investors, such as Tencent, Sequoia Capital, Yunfeng Fund and Didi Chuxing, into the capital of China Evergrande New Energy Vehicle Group. The placing of existing shares and top up subscription of new stocks under a general mandate are each worth HKD 4.00 billion (USD 516.11 million). Evergrande’s Evergrande Health Industry Holdings is currently the controlling shareholder of the electric car maker, with a 74.9 per cent stake. This indirect, wholly-owned British Virgin Islands-incorporated subsidiary is placing out 176.58 million existing stocks, representing a 2.0 per cent post-subscription stake, to no less than six investors. At HKD 22.65 apiece, the price is a discount of 19.9 per cent to the close of HKD 28.30 on 14th September, the last unaffected close prior to the announcement. The subscription comprises the sale of 176.58 million new stocks, representing a post-issue stake of 2.0 per cent, to raise a matching HKD 4.00 billion. Following the placing and equity dilution, Evergrande Health Industry will own 6.48 billion shares, or 73.5 per cent, of China Evergrande New Energy Vehicle. The electric car manufacturer intends to use proceeds from the subscription for general corporate purposes. Its directors noted the placing and share sale is in its best interests as it will broaden the shareholder base and bolster the balance sheet for long-term development and growth. Zephyr, the M&A database published by Bureau van Dijk, shows 763 deals targeting manufacturers of motor vehicles, bodies and trailers, and parts have been announced in 2020 to date. Nio Anhui’s capital increase worth USD 4.10 billion is the largest of the year so far, following by Geely Automobile obtaining a secondary listing in Shanghai following an offering worth USD 3.35 billion. Evergrande New Energy Vehicle’s placing and subscription are ranked in the top 25 deals targeting this field in 2020 to date. © Zephus Ltd