Nio announced Abu Dhabi government fund CYVN increased its stake in the company from 7% to about 20%. CYVN invested 2.2 billion USD in cash to subscribe for 294,000,000 newly issued Class A shares of Nio. The share purchase price is 7.50 USD, according to the press release.
This marks the trend of the Middle East becoming the principal investor for Chinese EV startups. BeyonCa, HiPhi, Hengchi, and Pony.ai recently received significant investments from Saudi and UAE investors or are in latter-stage talks.
In July 2023, Nio welcomed the first investment of 738.5 million USD from CYVN, which became a 7% shareholder, and acquired specific Class A shares from Tencent Holdings Ltd. for 350 million USD. With the recent December Investment Transaction finalized, CYVN will hold approximately 20.1% of the company’s total issued and outstanding shares.
As long as CYVN maintains ownership of at least 15 percent of Nio’s shares, they can nominate two directors to Nio’s board of directors. They can have one director on board if they own more than 5% (but less than 15%).
“With a strengthened balance sheet, Nio is poised to enhance brand positioning, boost sales and service capabilities, and invest in core technologies, solidifying its leading position in the automotive industry transformation,” said William Bin Li, founder and CEO of Nio.
“Our increased investment in Nio represents a continuation of our ongoing strategy to build a leading global portfolio in the mobility space,” said Jassem Al Zaabi, Chairman and Managing Director of CYVN Holdings. “This transaction demonstrates our confidence in Nio’s unique positioning and competitiveness. We are excited to be a long-term strategic partner of Nio and support its efforts in international market expansion.”
Autumn was very rich when it came to oil-rich countries investing in Chinese EV and AV startups. In October, BeyonCa, a young EV maker founded by an ex-Volkswagen executive, signed a preliminary agreement to sell a stake to Saudia Arabia’s Al Faisaliah Group (AFG). BeyonCa is backed by state owned Dongfeng Motor and Renault.
In the same month, self-driving start-up Pony.ai received a 100 million USD investment from Saudi Arabia’s smart city developer Neom. Pony.ai said they plan to use it to fund research and development and to reinforce its operations.
In November, Saidu fund PIF announced it is in talks with Human Horizons, the company behind the HiPhi brand known for its sci-fi like EVs. PIF wants to invest 250 million USD into the automaker as Saudi Arabia tries to develop the domestic auto industry.