This article is currently being updated. Please update later for more details.
Nio China has received a new investment of RMB 3.3 billion from strategic investors in Hefei, and will also invest RMB 10 billion to subscribe to Nio China’s newly issued shares.
Nio (NYSE:NIO) announced that Nio China has received new investment from investors in Hefei, Anhui province, as the Chinese operating entity receives further support from the city.
The EV manufacturer today announced that it has signed a definitive agreement with Hefei Jianheng New Energy Vehicle Investment Fund Partnership, Anhui Emerging Industry Investment Co., Ltd. and CS Capital Co., Ltd. to invest in its 92.1%-owned Chinese subsidiary Nio Holding Co Ltd. did. (Nio China).
The strategic investors will invest a total of 3.3 billion yuan in cash to subscribe to Nio China’s newly issued shares.
At the same time, Nio will invest a total of RMB 10 billion in cash to subscribe for newly issued shares of Nio China.
Upon completion of the investment transaction, Nio will control 88.3% of Nio China’s shares, and the Strategic Investor, along with other existing shareholders, will hold the remaining 11.7% of Nio China’s shares.
Nio also has the right to invest an additional RMB20 billion until December 31, 2025 to subscribe for additional shares in Nio China at the same price and on the same terms as the investment transaction.
The transaction is subject to regulatory and internal approvals and customary closing conditions.
Strategic investors and Nio will inject capital into Nio China in two stages, with 70% of the strategic investment amount and Nio investment amount to be made by the end of November 2024, and the remaining 30% by the end of December. I’m planning to be. 2024.
This investment not only demonstrates the strategic investor’s strong support for the high-quality development of the EV industry, but also underlines the strategic investor’s strong recognition of Nio’s unique values and industry leadership. the EV manufacturer said.
With a strengthened balance sheet, Nio is strategically positioned to maintain long-term leadership in technology, products, services and user communities, the company said.
This will also facilitate the company’s multi-brand strategy and broader market penetration, propelling the company to the next stage of sustainable growth, the company said.
Nio China is a subsidiary of Nio and is headquartered in Hefei city, which was founded after Hefei investors rescued the EV maker in late 2019. Nio’s global headquarters are located in Shanghai.
On April 29, 2020, Nio signed an agreement with a strategic investor in Hefei City to invest in Nio China. At that time, Strategic Investors and Nio invested RMB 7 billion and RMB 4.26 billion, respectively, in Nio China.
Upon completion of the transaction in April 2020, both parties will own a 24.1% and 75.9% equity interest in Nio China, respectively, and Nio China will receive a capital increase of RMB 11.26 billion.
In February 2021, Nio announced that it would buy back 3.305% of its shares from two strategic investors in Nio China for 5.5 billion yuan. At the same time, Nio increased its stake in Nio China by RMB10 billion.
According to the February 2021 statement, upon completion of the share acquisition and capital subscription, Nio now has a total controlling interest of 90.36% in Nio China.
In the first quarter of 2020 earnings conference, Nio founder, chairman and CEO William Li said that Nio China has the potential to conduct an IPO in the Chinese market.
The February 2021 share buyback move was thought at the time to be a possible preparation for Nio China’s IPO, but Nio has since denied this.
A February 2021 report in the Securities Journal noted that based on Nio’s 2020 definitive investment agreement with Hefei, Nio China must file for an IPO within 48 months and achieve an IPO within 60 months. did.
Otherwise, the strategic investor will require Nio to repurchase Nio China shares at the redemption price of the strategic investor’s total investment, compounded at 8.5% per annum, the report said.
Nio says buyback of Nio China shares has nothing to do with latter’s IPO
Become a CnEVPost member
Become a CnEVPost member to enjoy an ad-free reading experience and support the production of more quality content.
become a member
Already a member? Sign in here.
