Evergrande’s Chinese group has raised about $145 million in recent days by selling part of its shares in film production and internet media company HengTen Networks. So the real estate giant has sold about 5.7% of the shares of HengTen Networks and is making more money as payment terms for additional bonds approach.
New moves this month have reduced Evergrande’s share from 26.55% to 20.8%, records show. HengTen’s market capitalization was $2.43 billion at the close of trading in Hong Kong on Monday (8), a sharp drop from a peak of more than $17 billion in February, according to the FactSet.
In July, Tencent paid Evergrande about $266 million for 7% of HengTen’s shares, increasing its stake in the company to 23.9%. After the most recent sale of Evergrande shares, Tencent becomes the main shareholder of HengTen.
The largest credit-rated debt issuer in China, with about $20 billion in bonds, Evergrande has so far managed to avoid a default by making past-due interest payments on its international bonds just before the expiration of their 30-year grace periods. days. The company profited from $128.5 million in coupon payments in October, the same month it sold two of its private jets to raise cash.
On Nov. 11, there is another deadline for making $148 million late payments on three other sets of bonds, according to debt research firm CreditSights. Another $82 million in interest payments due last Saturday on dollar bonds issued by the Scenery Journey unit, and are subject to similar grace periods.
While Evergrande has no onshore or offshore bonds maturing this year, its dollar-denominated bonds have been trading at deeply distressed levels, indicating investors expect the company to default.
Evergrande has struggled to sell other assets to raise money abroad. Last month, the company abandoned a plan to raise $2.6 billion by selling a majority stake in its property management unit to another Chinese developer, and failed to sell its Hong Kong office building for which it paid US $1.6 billion in 2015.
HengTen was formerly known as Mascotte Holdings and used to be a struggling company that mainly manufactured and sold photographic accessories. In 2015, Evergrande and Tencent became its controlling shareholders and helped reshape and expand the production company into new lines of business. Source: Dow Jones Newswires.
Reference: CNN Brasil