Reuters reported China Evergrande Group sold four projects to two state-owned trust firms to resolve its shortage of funds.
On Friday, Evergrande announced that two trust firms would buy its shares and “right to debt” in four projects with 2.13 billion yuan (337 million dollars).
Everbright Trust bought a residential development in Chongqing and Dongguan for 1.03 billion yuan (163 million dollars). Minmetals Trust got a housing project in Foshan and a theme park development in Guangzhou worth 1.1 billion yuan (174 million dollars).
The two trust firms will take care of the construction and delivery of the properties to homebuyers. Evergrande’s initial capital contribution will be paid with profits from property sales.
The deals allow Evergrande to collect 1.95 billion yuan (310 million dollars) of the initial capital contributed and pay its liabilities in the projects of around 7 billion yuan (1.11 billion dollars).
Evergrande said, “the contribution amount recovered will have a positive impact on the group’s efforts in both debt settlement and guarantee of property delivery of other projects.”
Evergrande has consecutively lost its control in its assets from the beginning of the year when it seriously lacked liquidity.
A Chinese court ordered the freezing of Evergrande assets worth more than 1 billion yuan (158 million dollars) for outstanding construction costs.
A municipal court in Guangzhou froze 361.5 million yuan (57 million dollars) Evergrande assets in early February.
Guangzhou Intermediate People’s Court has also frozen 640.4 million yuan (101 million dollars), sued by State-owned Shanghai Construction last December.