Evergrande EV unit’s liquidators still in talks with potential stake buyers

(Reuters) -Liquidators of the electric vehicle arm of debt-laden China Evergrande (HK:3333) are still in talks with a potential buyer to take a stake in the company with a view to provide a new credit line to support production.

In its initial days, the electric vehicle maker aimed to take on Tesla (NASDAQ:TSLA) and had a market valuation higher than Ford Motor (NYSE:F), but it has since been mired in the debt crisis engulfing its property developer parent.

China Evergrande New Energy Vehicle said on Thursday its liquidators had not yet entered an agreement with any potential stake buyer nor has there been any deal to extend credit to the electric vehicle manufacturer.

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 arm had said in a statement in late May.

The firm, which in August said two of its units had commenced bankruptcy proceedings, has been severely short of funds and has faced pressure from its creditors and a local government.