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In order to promote the development of automobile sales and other areas, Evergrande Group formally joined Guanghui Group in September 2018, becoming the second largest shareholder of Guanghui Group. Guanghui Automobile, a subsidiary of Guanghui Group, is the largest car dealer group in China. Unexpectedly, two years later, Evergrande Group completely divested.

On November 1st, Guanghui Automobile announced that Evergrande Group, Shenneng Group and Sun Guangxin, the actual controller of the company, signed an equity transfer agreement on the target company Guanghui Group. Evergrande Group sold its 40.964% stake in Guanghui Group to Shenneng Group for a total price of 14.85 billion yuan. after the completion of the transaction, Shenneng Group became the second largest shareholder of Guanghui Group, and Evergrande no longer holds a stake in Guanghui Group.

It means that the mission of Evergrande Group to promote automobile sales and other areas with Guanghui Group as the carrier also officially ended after the divestment.

In September 2018, Evergrande Group and Guanghui Group formally signed a strategic cooperation agreement. Shareholders of Guanghui Group transferred 23.865% of their shares to Evergrande Group for a total consideration of 6.68 billion yuan. In addition, Evergrande Group invested 7.81 billion yuan to increase capital to Guanghui Group. After the capital increase is completed, Evergrande Group will spend a total of 14.49 billion yuan and hold a 40.964% stake in Guanghui Group, making it the second largest shareholder of the company.

Evergrande Group said at the time that its equity investment was to better promote the future development of the enterprise, and to carry out comprehensive strategic cooperation with Guanghui Group to promote the development of Evergrande in the areas of automobile sales, energy, real estate and logistics.

According to officials of Xinjiang Guanghui Industrial Investment Group, the company was founded in 1989 and is mainly engaged in energy, automobile sales, logistics, real estate and machinery industry. Now it has four listed companies: Guanghui Energy, Guanghui Automobile, Guanghui Logistics and Guanghui Baoxin. At present, only Guanghui Real Estate and machinery industry are not listed in its core business. The actual controller of Guanghui Group, named Sun Guangxin, is known as "the richest man in Xinjiang" and currently holds a 63.6% stake in the company.

Among them, Guanghui Automobile is the largest automobile dealer group in China. By the end of December 2019, Guanghui Automobile has established a car distribution network covering 28 provinces, autonomous regions and municipalities directly under the Central Government, distributing more than 50 passenger car brands, and operating 841 outlets across the country, including 782 4S stores. Specifically, there are 229 ultra-luxury and luxury brand 4S stores, 522 middle and high-end brand 4S stores and 31 independent brand 4S stores.

According to the 2019 annual report of Guanghui Automobile Group, its operating income was 170.5 billion yuan, up 2.58% from the same period last year; the net profit belonging to shareholders of listed companies was 2.6 billion yuan, down 20.16% from the same period last year.

The buyer who took over the equity this time is Shenneng (Group) Co., Ltd., a wholly state-owned limited liability company funded and supervised by the Shanghai State-owned assets Supervision and Administration Commission, which is mainly engaged in the investment, construction, operation and management of power, urban gas and other energy infrastructure projects, and is an important main body to ensure the security of energy supply in Shanghai. In addition, Shenneng Group is also engaged in financial enterprise equity investment and asset management business.

Evergrande Group is a well-known real estate development and management enterprise in China. In recent years, it has become famous in the automobile field because of its huge investment and high-profile new energy manufacturing. In July this year, Evergrande renamed its listed company Evergrande Health to Evergrande Automobile to achieve an internal backdoor listing.

In August, the Evergrande car press conference was officially held, and six new cars of the "Hengchi" brand were launched, and Hengchi 1, Hengchi 2, Hengchi 3, Hengchi 4, Hengchi 5, Hengchi 6 were unveiled, covering A to D class models, as well as cars, sedan cars, SUV, MPV, crossover cars and other models. Evergrande expects trial production of Hengchi products in the first half of 2021 and strive for mass production in the second half of 2021.

As the new car is not yet on the market, the auto business still needs continuous blood transfusions from Evergrande. Evergrande Group previously disclosed that it is expected to invest a total of 29.4 billion yuan in the automotive business, mainly in equity acquisition, base construction, research and development, equipment, and so on. After Evergrande cars are mass produced and sold, the group will no longer have investment.

Evergrande announced that its board of directors decided to issue RMB shares and list Science and Technology Innovation Board on the Shanghai Stock Exchange.

China Evergrande announced in the evening that the sale of its stake in Guanghui will help the group to focus on its core business and achieve long-term, stable and healthy development.

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