Evergrande struggles to survive and finds sources of funds to cover part of the debt

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Events continue to develop around one of the largest developers in China, Evergrande. This situation is important for our community, and, in principle, for the entire global electric vehicle industry, because the Evergrande Group includes the Evergrande Auto car company, which previously presented its electric vehicles in all segments under the Hengchi brand.

But, despite all the seeming tragedy of the situation, the Chinese government does not intend to collapse the company at all. In fact, no one needs it, but it is the financial recovery of the company that is needed. At the same time, in the first half of this year, the real estate development division of Evergrande was profitable, and revenue increased compared to a year earlier. However, the situation is as it is, and the management of Evergrande will have to take measures that, apparently, they do not really like, that is, to sell part of their assets. And so far it is not Hengchi’s electromobile asset.

A few days ago, # Beijing urged Chinese state-owned companies and state-backed developers to buy some of Evergrande’s assets.

Evergrande Property Services Group today requested the suspension of trading in the company’s shares due to the fact that another major Chinese # developer

Earlier, Evergrande announced the sale of its share in the size of

This, of course, will not solve all problems completely and immediately, but it will relieve excessive pressure on the company as a whole. And perhaps it will take you out of the blow

The few and lapidary press releases of Evergrande speak almost of the Taoist equanimity of the company’s management, and the confidence that, step by step, the situation will be normalized.

My guess is that most likely none of the competing companies, even the Chinese ones, will buy #hengchi. Moreover, it is this asset that the company’s management will try to preserve, no matter what. A lot has been invested in this project, in factories, and the main thing is that there are already cars themselves that were about to go into mass production.

Therefore, my assumption is that the #evergrande management will try by all available means, primarily at the expense of the real estate division, to reduce the debt overhang, to launch an automobile production, which will just give the necessary amount of cash to cover the previous debt obligations.


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