China Evergrande to sell $ 1.5 billion stake in Shengjing Bank to state-owned company

HONG KONG, Sept.29 (Reuters) – Cash-strapped China Evergrande (3333.HK) group on Wednesday announced plans to sell a 9.99 billion yuan ($ 1.5 billion) stake in Shengjing Bank Co Ltd (2066.HK) to a state-owned asset management company as it scrambles to raise funds.

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The 1.75 billion shares, representing 19.93% of the issued share capital of the bank, will be sold for 5.70 yuan each to Shenyang Shengjing Finance Investment Group Co Ltd, a state-owned enterprise involved in the management of capital and investment. ‘assets, China Evergrande said in a statement. deposit on the Hong Kong Stock Exchange.

Shenyang Shengjing’s stake in the bank will be increased to 20.79% after the agreement to become the bank’s largest shareholder.

“The company’s liquidity problem has negatively affected Shengjing Bank significantly,” Evergrande Chairman Hui Ka Yan said in the statement.

“The introduction of the acquirer, being a state-owned enterprise, will help stabilize the operations of Shengjing Bank and, at the same time, help to increase and maintain the value of the 14.75% stake in Shengjing Bank owned. by the Society.”

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Shengjing Bank demanded that all net proceeds from the divestiture be used to settle the group’s relevant financial debts owed to Shengjing Bank, Evergrande said.

Its stake in the bank would be reduced to 14.75% against 34.5%.

Reporting by Donny Kwok and Anne Marie Roantree; Editing by Kim Coghill and Stephen Coates

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