China’s Evergrande Seeks New Sources Of Funding Its Bottled Water Business
- ByAyushi Ray | July 20, 2021
China’s Evergrande seeks new sources of funding its bottled water business. The company is considering an initial public offering in Hong Kong for the same, people with knowledge of the matter said, as the country’s most indebted real estate developer seeks new sources of funding.The company is holding exploratory discussions with investment banks on a separate listing for Evergrande Spring, according to a source, however the matter is in too early a stage to discuss extensively. A potential IPO could raise several hundred million dollars and take place next year, the people said. Shenzhen-based Evergrande has been selling equity in non-property assets and accelerating property sales to reduce leverage, yet it is struggling to restore confidence among investors. China Evergrande Group owns a 49% stake in Evergrande Spring, according to its 2020 annual report.
Shares and dollar bonds of Evergrande slumped Monday following a court order that froze a bank deposit held by its onshore division. The stock fell as low as 17% in Hong Kong trading. Evergrande said in response that it will sue the lender, according to a statement. Decision making is going on at the moment, and Evergrande might decide to keep the business, the people said. Evergrande Spring offers over 50 products in the mineral water, grocery, dairy and fresh food segments, according to the parent company’s website. Its products are available in more than 30 provinces and cities across China, as well as over 10 countries and regions, participating in the country’s Belt and Road Initiative. Evergrande Spring has established partnerships with over 1,000 distributors and more than 500,000 sale outlets across China, according to the annual report.
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