A $500 million share sale deal between China Evergrande’s electric vehicle unit and a Dubai-based firm has lapsed, according to a Hong Kong stock exchange filing on Monday.
In August, China Evergrande New Energy Vehicle Group (NEV) had said it had agreed to issue 6.18 billion new shares to Dubai-based mobility company NWTN for a total HK$3.89 billion ($498.2 million).
But in a filing on Monday, the firm said that neither party had agreed on the extension of the long stop date, which is the last day of 2023.
That meant the share subscription and loan conversion subscription agreement by US-listed NWTN are no longer valid, NEV said.
The share sale deal was part of the unit’s plan to issue an aggregate of 5.44 billion new shares for HK$20.89 billion ($2.67 billion), as part of a restructuring proposal, to ease its loan burden and improve liquidity.
NWTN and Evergrande New Energy Vehicle has also signed a support deal for interest-free funding of RMB600 million to ‘aid business recovery’.
The funding was slated to be used for the research and development, manufacturing, and sales services of vehicles under the group.
Had the deal been completed, NWTN would have gained a 27.50% stake in NEV.
- Reuters, with additional editing by Vishakha Saxena