Nios ET5 is on display at Central China International Auto Show on May 25, 2023 in Wuhan, China.
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BEIJING – Chinese electric car manufacturer noo announced Tuesday that it had raised $738.5 million in new capital from an Abu Dhabi government fund.
The strategic investment ultimately gives the fund CYVN Holdings a 7% stake in Nio.
The deal is priced at $8.72 per share, according to a press release. That’s down 6.7% from Tuesday’s close for US-listed Nio shares, down about half a percent.
Nio said earlier this month that weak auto deliveries were hurting cash flow and delaying capital spending and some research and development projects.
The company said at the time it had enough cash to fund its business. Nio reported 14.76 billion yuan ($2.07 billion) in cash and cash equivalents in March, down from what it disclosed for late 2021 and 2022.
Middle East interest in China
In recent months, Middle Eastern investors have increasingly sought opportunities in China, particularly in electric cars.
China-based funds have also focused on Middle Eastern capital as investors from the US and elsewhere became wary of China amid regulatory uncertainty.
Nio said it expects the deal with the Abu Dhabi fund to be finalized in early July. After that, they plan to “use opportunities in Nio’s international business”.
The agreement also gives CYVN the right to appoint a director to Nio’s board of directors, the announcement said.