China Evergrande's EV-Einheit stellt Gespräche über Anteilsverkauf ein from

China Evergrande's EV Unit Halts Talks on Stake Sale

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Cash-Strapped Developer Focuses on Core Business

Deal With Auto Manufacturer Hengchi Canceled

China Evergrande Group's electric vehicle (EV) unit has suspended discussions over a stake sale, as the cash-strapped developer focuses on its core business. The talks with Hengchi Automobile Group, a unit of state-owned China Aerospace Science and Industry Corp., were called off, according to a statement from Evergrande New Energy Vehicle Group. No reason was given for the cancellation.

The halt in talks is the latest setback for Evergrande's EV ambitions. The company has been struggling to raise funds and has defaulted on some of its debts, leading to speculation that it may need to sell assets to stay afloat. The company's EV unit has been a drag on its finances, posting losses in recent quarters.

The stake sale was seen as a way for Evergrande to raise much-needed cash and reduce its debt burden. Hengchi had reportedly agreed to acquire a 51% stake in Evergrande New Energy Vehicle Group in a deal that valued the unit at $5 billion. However, the deal was never finalized.

The cancellation of the talks is a blow to Evergrande's EV aspirations. The company had invested heavily in the sector, but it has struggled to make its EVs profitable. The company's EV unit has only sold a few hundred vehicles since its launch in 2019.

The halt in talks also raises questions about the future of Hengchi, which has been struggling financially. The company had planned to use the Evergrande deal to expand its production capacity and launch new models. However, without the investment from Evergrande, Hengchi's future is uncertain.

The cancellation of the talks is a sign that Evergrande is focusing on its core business of property development. The company has been selling off non-core assets in recent months to raise cash and reduce its debt burden. It is unclear how the company plans to turn around its EV business, but it is clear that the stake sale with Hengchi is no longer on the table.