Shares in the electric vehicle arm of embattled Chinese property giant Evergrande more than doubled in Hong Kong on Monday as trade resumed as the news of a possible buyer of the firm emerged.
Heavily indebted, Evergrande has become the poster child of the yearslong crisis in China's real estate market, a crucial pillar of growth in the world's second-largest economy.
Earlier this year, the firm was handed a winding-up order by a Hong Kong court after struggling for years to repay creditors after its 2021 default.
The crisis has impacted the company's subsidiaries, hammering their share prices.
But China Evergrande New Energy Vehicle Group (NEV) briefly soared as much as 113% Monday as trading resumed after being suspended on May 17.
According to Bloomberg News, that represented the biggest intra-day jump in nearly 10 years.
However, the firm's shares are still worth just a fraction of what they were at their peak in 2021 before the crisis struck Evergrande.
The surge followed its announcement on Sunday that liquidators were in talks with potential buyers of almost 60% of the company's shares.
The buyer would take an initial 29% stake and have an option to purchase another 29.5% later.
It also mentioned the possibility of providing a line of credit "for the purpose of financing the group's continuing operation," the statement added.
Last week, Chinese authorities ordered Evergrande NEV to repay 1.9 billion yuan ($262 million) of subsidies and incentives, which the company said "could have a material adverse impact on the financial position."
In January, the company said its executive director Liu Yongzhuo had been detained "on suspicion of crimes."
