The Middle East financiers repented, and the 4.2 billion life-saving money in the automobile business was in vain, and the official has given up on Evergrande and is about to declare bankruptcy?
Recently, Evergrande Automobile announced that the share subscription agreement signed with Newton Group has expired on December 31, 2023.
After the news broke, investors panicked, which meant that Evergrande Automobile's most significant self-rescue operation suffered a fiasco.
Since the thunderstorm, Xu Jiayin and the Risk Mitigation Committee have been busy negotiating with creditors at home and abroad, hoping that they can convert their debts into equity, and are also looking for saviors everywhere, but the 2.58 trillion hole has scared everyone away, and the progress has been very slow, and it was not until August last year that Newton Group came.
The mysterious financier, who has a background in the sovereign wealth funds of Middle Eastern countries, claims to make a strategic investment of US$500 million in Evergrande Automobile, and generously provides 600 million yuan in transitional funds.
After signing the agreement, Evergrande Automobile said in a high-profile manner that it was ready to use all these war investment funds in the Tianjin factory to ensure the normal production of Hengchi 5 and the mass production of Hengchi 6 and Hengchi 7.
Newton Group will assist Evergrande Automobile to explore overseas markets and export 3-50,000 Hengchi cars to the Middle East every year. ”
I wasn't too optimistic about the deal, asserting at the time that it wasn't likely to land, and it turned out as expected. However, this is simply bad news for Evergrande Group and Evergrande Automobile.
Evergrande Automobile has always been considered by many to be one of the very few high-quality assets of Evergrande Group, if it can be revitalized, it can greatly enhance the confidence of all creditors, the loss of Newton Group's capital injection is catastrophic, Evergrande Automobile at any time to face the possibility of shutdown.
The semi-annual report shows that in the first six months of 2023, Evergrande Automobile achieved revenue of 155 million and a gross loss of 60.88 million, a year-on-year increase of 532%, as of June 30 last year, 27 billion borrowings, 9.34 billion debts due and unpaid, 3.59 billion overdue commercial bills, and total liabilities of more than 75.6 billion, while the cash and cash equivalents on the account were less than 96.89 million.
Evergrande Automobile is completely waiting for Newton Group's money to continue its life, and now that the duck to the beak has flew, how can it play down?
After seven consecutive adjournments, the winding-up hearing of Evergrande Group is scheduled to be held on the 29th of this month. It is widely believed that liquidation will be inevitable if the Risk Mitigation Committee is unable to come up with a viable debt restructuring plan before then.
However, the current Evergrande is a dead end, in order to restructure must issue some new notes to creditors to replace the previous notes, the problem is that the China Securities Regulatory Commission has opened an investigation against Evergrande Real Estate, which is not qualified to issue new notes during this period.
The failure to implement the previous debt restructuring plan is directly related to this. Now, even if the China Securities Regulatory Commission is willing to open up the net, I am afraid it will be too late.
According to the announcement a few days ago, by the end of November 2023, there will be 2,053 litigation cases with a target amount of more than 30 million yuan and no judgment yet, with a cumulative total of more than 490 billion yuan, and the total amount of unpaid due debts is 316.4 billion.
These figures are very desperate, it is difficult for creditors to see what Evergrande still has the ability to operate sustainably, and the management will not be able to achieve this virtue if they have a little bit of integrity, how can they be expected to turn things around?
Judging by the official trend, it seems that they are ready to give up after more than two years of hard work. At the beginning, HNA only caught Chen Feng after finalizing the restructuring plan, and Evergrande has not yet made a move on Xu Jiayin, do you think this is a complete abandonment of Evergrande?#Stock Finance##House Price##社会百态#