By P.R. Venkat
China Evergrande New Energy Vehicle said an agreement for a Dubai-based automaker to subscribe to its shares has expired, raising fresh doubts about a potential cash injection for the Chinese electric-vehicle manufacturer.
The parties to the share subscription and the loan conversion agreement by Nasdaq-listed carmaker NWTN haven’t agreed to extend the long stop dates, which expired Dec. 31, 2023, Evergrande New Energy Vehicle, also known as Evergrande Auto, said in a filing late Monday.
Evergrande Auto shares fell nearly 18% early Tuesday, a three-month intraday low in terms of percentage decline, following the news.
NWTN in October suspended the performance of relevant obligations under its share subscription, citing significant uncertainties regarding the EV maker’s parent, China Evergrande Group.
However, Evergrande Auto had said then that talks would continue between the related parties.
NWTN had planned to invest $500 million for a 28% stake in Evergrande Auto, which was intended to be used by the latter to fund the expansion of its factory that has been delayed by its parent’s financial problems.
In Monday’s filing, Evergrande Auto reiterated that the parties to the NWTN share subscription and the loan conversion subscription agreement will continue to negotiate amendments to certain key terms of the deal.
Write to P.R. Venkat at [email protected]
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