CHINA Evergrande Group raised HK$16.4 billion (S$2.84 billion) selling a stake in its online home and car sales platform ahead of a planned listing in the US.
Two Evergrande units issued a combined 1.3 billion new shares of a subsidiary that holds a majority stake in the online business known as FCB Group, the developer said on Monday in a filing. The investors will hold a 10 per cent stake in the unit after the sale is completed.
FCB Group is weighing an initial public offering in the US as soon as the fourth quarter, sources said last week. The portal, currently valued at about 130 billion yuan (S$26.7 billion), had separately reached out to prospective investors for a pre-IPO funding round, the sources said.
Evergrande was among the first Chinese developers to start selling homes online, and ran promotional campaigns as the coronavirus outbreak halted on-site sales. FCB, or Fangchebao, comprises a suite of platforms for buying and selling real estate and other assets including new and used cars in China.
Strategic investors in the funding round include United Strength Harmony Ltd, Shenzhen Mingsheng Duling Commerce and Trade Co and Citic Capital Holdings Ltd, the filing shows. If the unit doesn't complete an IPO on Nasdaq or any other stock exchange 12 months after the completion of the stake sale, the unit is required to repurchase the shares with a 15 per cent premium.
China Evergrande, controlled by billionaire Hui Ka Yan, jumped 3.51 per cent to close at HK$15.34 in Hong Kong trading on Monday. BLOOMBERG