China Evergrande Group is planning to sell its entire stake in streaming company HengTen Network Holdings for HK$2.13 billion ($273.5 million) as the embattled developer disposes of assets to pay off its debts.
Evergrande will be selling 1.66 billion HengTen shares to Hong Kong-based Allied Resources Investment Holdings at HK$1.28 per piece, according to a Hong Kong stock exchange filing. The shares are discounted by about 24 percent from their last closing price on Wednesday.
The property giant said that the sale would translate to an HK$8.5 loss as it rushes to raise funds to settle over $300 billion in liabilities. The firm said in the filing that it will use the proceeds of the HengTen sale as working capital.
“It’s good for the short term as liquidity is easing,” said Bloomberg property analyst Patrick Wong, but added that the sale shows Evergrande’s eagerness to raise cash given that HengTen’s share price is falling.
Evergrande has been making last-minute payments on overdue bond interests in recent weeks. Investors are now monitoring a newly missed deadline on Nov. 6 to see if the cash-strapped firm can settle an $82.5 million obligation by the end of a grace period on Dec. 6.
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