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Shares of China Evergrande's EV unit soar after liquidators' stake sale deal

China Evergrande New Energy Vehicle factory in Tianjin

HONG KONG (Reuters) - Shares of China Evergrande New Energy Vehicle Group more than doubled on Monday as trade resumed after the company said liquidators had agreed on behalf of key shareholders to sell a stake in the electric vehicle (EV) maker.

Shares of embattled developer China Evergrande's EV unit soared as much as 113% to HK$0.81, their highest since September 22, becoming the top gainer on the Hong Kong bourse, and last stood up 79%, following the May 17 trade halt.

The non-binding deal by liquidators acting for China Evergrande Group, Evergrande Health Industry and Acelin Global provides for a third-party buyer to take a stake of 29% in the unit, with an option for 29.5% more, the EV unit said on Sunday.

The three collectively hold 58.5% of the cash-strapped EV unit, whose factory in the northern city of Tianjin stopped production at the start of 2024.

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The EV unit said the term sheet also mentioned that the potential purchaser would provide a line of credit to fund its operation and business development.

Last week, China Evergrande New Energy Vehicle said its unit had received a letter from local administrative bodies demanding repayment of 1.9 billion yuan ($262 million) in subsidies and incentives.

Earlier this year, China Evergrande, the world's most indebted property developer, was ordered to be liquidated after it was unable to offer a concrete restructuring plan, more than two years after it defaulted on its offshore debt.

(Reporting by Hong Kong newsroom; Editing by Clarence Fernandez)