Middle Eastern tycoons are taking action again! NIO acquires $1.1 billion in investment shares | cash | tycoons
NIO has signed a share subscription agreement with Abu Dhabi investment firm CYVN Holdings. According to the agreement, CYVN Holdings will make a total strategic investment of approximately $1.1 billion to NIO through targeted issuance of new shares and transfer of old shares. CYVN Holdings is an institution in which the Abu Dhabi government holds a majority stake, focusing on strategic investment and layout in the advanced and intelligent mobile transportation sector, and committed to collaborating with industry leaders in this field worldwide.
Li Bin, Chairman of NIO, stated that CYVN's strategic investment reflects NIO's unique value in the intelligent electric vehicle industry. This investment transaction will further strengthen NIO's balance sheet, providing impetus for the company's sustained efforts in accelerating business growth, promoting technological innovation, and establishing long-term competitiveness.
On June 9th, NIO submitted a less than ideal quarterly report. In the first quarter of this year, NIO's total revenue was 10.6765 billion yuan, a year-on-year increase of 7.7% and a month on month decrease of 33.5%; The net loss was 4.7395 billion yuan, an increase of 165.9% year-on-year and a decrease of 18.1% month on month; A total of 31000 cars were delivered, a year-on-year increase of 20.5% and a month on month decrease of 22.5%.
As of March 31, 2023, NIO's cash and cash equivalents held amounted to RMB 14.763 billion, a year-on-year decrease of 25.77%.
NIO stated at the performance briefing that this year, due to the release of new products in the first and second quarters, some operational cash flows have been affected. However, the current cash flow is sufficient to support the company's operations, and the financing channel is currently unobstructed.
After receiving a 7.899 billion yuan investment from CYVN, NIO's cash and cash equivalents in its accounts will exceed 22.6 billion yuan, exceeding the level of the same period last year.
According to NIO's expectations, by mid-2023, NIO will fully complete intergenerational product switching, and all eight second-generation technology platform models will be on sale. Sales will rebound in the third quarter and cash flow will improve.
Li Bin stated that the all-new ES6 is confident in achieving monthly sales of 10000 units in July. Meanwhile, NIO is very confident in achieving its target of selling an average of over 20000 units per month in the second half of the year.
It is worth mentioning that NIO is not the first Chinese car making new force to receive investment from Middle Eastern tycoons.
From June 11th to 12th, during the China Arab Cooperation Forum, the Ministry of Investment of the Kingdom of Saudi Arabia signed an agreement with the parent company of Gaohe Automobile, China Express, for approximately 40 billion yuan to establish a joint venture engaged in automotive research and development, manufacturing, and sales.
On December 12, 2022, Tianji Automobile announced the establishment of a joint venture with Sumou Holding in Saudi Arabia, jointly investing approximately $500 million in two phases to establish a production, manufacturing, and research and development base for new energy vehicles, with an annual output of approximately 100000 new energy vehicles.
Red Star News reporter Wu Danruo
