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Evergrande founder sells 9% stake for $344 million amid debt crunch

Evergrande founder sells 9% stake for $344 million amid debt crunch
Evergrande founder sells 9% stake for $344 million amid debt crunch   -   Copyright  Thomson Reuters 2021   -  
By Reuters

<div> <p><span class="caps">HONG</span> <span class="caps">KONG</span> – The chairman of China Evergrande Group Hui Ka Yan sold 1.2 billion shares in the company at an average price of HK$2.23 each on Thursday, Hong Kong Stock Exchange filings show.</p> <p>The share sale, which is worth a total of HK$2.68 billion ($344 million), lowers Hui’s stake in the Shenzhen-based real estate company to 67.9% from 77%.</p> <p>Evergrande has been stumbling from debt deadline to deadline as it grapples with more than $300 billion in liabilities and Chinese authorities have told Hui, 63, to use some of his personal wealth to help pay bondholders, sources have said.</p> <p>Hui, who is the property developer’s founder, is now freeing up funds by selling luxury assets including art, calligraphy and three high-end homes.</p> <p>Evergrande failed to pay coupons totalling $82.5 million due on Nov. 6 and investors are on tenterhooks to see if it can meet its obligations before a 30-day grace period ends on Dec 6.</p> <p>Hui’s share sale represented a 19.8% discount to Wednesday closing price of HK$2.78. Data from the exchange shows block trades priced at HK$2.23 per share were carried out in the pre-market on Thursday. </p> <p>Before the filings, Evergrande shares closed down 10.4% at HK$2.5, versus a 2.7% drop in the broader market.</p> <p>($1 = 7.7959 Hong Kong dollars) </p> <p/> </div>