After Evergrande bills is Evergrande Motor Stock! “Big D meeting” is also withdrawn?
Wall Street
Source: Wall Street
On Thursday, China Strategic Group announced its interim results that the company turned profit into a loss, with a loss attributable to shareholders of nearly 200 million Hong Kong dollars, compared with a profit of more than 50 million Hong Kong dollars in the same period last year.
The huge loss of China Strategic Group this time is mainly because the fair value of its investment in Evergrande Automobile has decreased by approximately HK$173 million. In this regard, Zhongce directly stated that it is considering selling part or all of its investment in Evergrande.
Zhongce wants to sell Evergrande auto stock
According to the announcement in the semi-annual report of the China Strategic Group, the share price of Evergrande has fallen sharply due to the recent negative news of China Evergrande Group, the holding company of Evergrande Auto.
Based on the closing price of Evergrande Auto on the date of the announcement (August 26) of RMB 5.18, the book value of Evergrande Auto held by China Strategic Group is approximately HK$692 million, a decrease of approximately 82 from the HK$3.861 billion held at the end of June. %.
According to the announcement, as of June 30, China Strategic Holdings held 133 million ordinary shares of Evergrande Auto, accounting for approximately 1.37% of its issued shares. The book value of Zhongce Group’s investment in Evergrande Motor is approximately HK$3.861 billion, accounting for approximately 46.96% of its total assets.
China Strategic Group stated that it will consider selling its shares listed on Evergrande Motor when it considers it appropriate to consider a number of factors, including but not limited to publicly available information on the development and prospects of Evergrande Automobile’s business, current market sentiment and market conditions. Part or all of the investment.
As of June 30, Evergrande Automobile held 98.48% of the total investment portfolio held by Zhongce Group.
Zhongce just sold Evergrande bills
On August 24, China Strategic Group announced that Jiazhi, an indirect wholly-owned subsidiary, sold 8.75% and 9.5% of China Evergrande’s senior notes in the secondary market, with a total face value of US$2 million and US$5 million, respectively, for a total consideration. They are approximately US$763,000 and US$1.875 million respectively.
For this combined sale, China Strategic Group expects a small overall loss of approximately US$4.714 million.
China Strategic Group is principally engaged in investment securities, electronic component trading, money lending and securities brokerage businesses. According to China Strategic’s 2020 annual report, Zheng Jiachun is currently the largest shareholder with a shareholding ratio of 16.67%.
Zheng Jiachun is the son of the late Hong Kong’s top richest man, Zheng Yutong, and the chairman of New World Group. He spent HK$204 million to take control of the China Strategic Group, allowing Hong Kong’s top wealthy circle “Big D Club” to enter the market again.
In October 2009, Evergrande held a IPO promotion conference in Hong Kong. Zheng Yutong, Liu Luanxiong and Zhang Songqiao, regarded as core members of the “Big D Conference”, all arrived at the platform.
In recent years, China Strategic Group has acquired China Evergrande Senior Notes several times.
According to public data, on March 29, 2017, China Strategic Group’s indirect wholly-owned subsidiary Jiazhi Investment completed the acquisition of 9.50% of China Evergrande senior notes with a total principal amount of US$50 million and a total consideration of US$50 million.
On September 25, 2020, China Strategic Group indirectly wholly-owned and acquired 6.25% and 8.9% China Evergrande notes due in 2021 with a total principal amount of US$5 million each in the open market, with a total consideration of approximately US$4.29 million and $4.35 million.
In fact, China Strategic Group not only holds a lot of Evergrande’s senior notes, but has also invested in Evergrande Health, the predecessor of Evergrande Auto in 2015.
China Strategic Group stated in its 2020 annual report that since March 2015, it has invested in Evergrande Auto. At the end of 2020, China Strategic held 134 million ordinary shares of Evergrande Auto, accounting for approximately 1.52% of its issued shares.
China Evergrande’s share price has fallen by more than 50% so far this year. China Evergrande owns 75% of the equity of Evergrande Motor, and the current market value of Evergrande Motor is about 65.5 billion Hong Kong dollars.
As of press time, China Evergrande reported 4.44 Hong Kong dollars, up 4.96%; Evergrande Auto reported 6.71 Hong Kong dollars, up 29.34%, the largest intraday increase in more than a month.
In terms of bonds, China Evergrande’s US dollar debt reached a new low. China Evergrande’s U.S. dollar bonds due in 2025 fell by 1 cent to 36 cents per U.S. dollar, which is the lowest since listing; U.S. dollar bonds due in 2022 fell by 1.7 cents to 44.8 cents per U.S. dollar. .
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