A man drives a cart past apartment buildings at China Evergrande Group’s Life in Venice real estate and tourism development in Qidong, Jiangsu province, China, on Tuesday, Sept. 21, 2021.
Qilai Shen | Bloomberg | Getty Images
Hong Kong-listed shares of investment holding firm Chinese Estates surged on Thursday after the firm announced plans to potentially dispose of its entire stake in debt-ridden developer China Evergrande Group.
On Thursday morning, shares of Chinese Estates soared as high as 15.14%. Some of those gains were pared in the trading session, but the stock was still up 5.5% by the afternoon.
The gains came after Chinese Estates announced it had sold more than 108 million shares in China Evergrande Group — representing about 0.82% of Evergrande’s issued share capital — from Aug. 30 to Sept. 21. The shares were sold at an average selling price of approximately 2.26 Hong Kong dollars (about $0.29), Chinese Estates announced on Thursday.
The investment holding firm also detailed plans to seek approval from shareholders for the potential disposable of Chinese Estates’ remaining shares in China Evergrande Group, which represent about 5.66% of the troubled developer’s issued share capital.
In the filing, China Estates said its directors are “cautious and concerned” about recent developments surrounding China Evergrande Group.
Just days earlier, its Chairman Lau Ming-Wai told CNBC’s Emily Tan that Beijing has “all the tools” to solve the issue surrounding Evergrande.
“I think the mainland government is very well versed in handling events or shocks or crises, whether it’s natural or man-made,” Lau said. “I think they have all the tools in their tool box — whether it’s monetary or fiscal, to solve this.”
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