A subsidiary of Hong Kong-listed Apollo Future Mobility Group, a smart mobility solution firm, has entered into an agreement to acquire WM Motor Holdings Limited for around $2 billion, according to a filing on the Hong Kong Stock Exchange on Thursday.
The acquisition, which will be settled via allotment and share issuance at HK$0.55 per share, is expected to result in a reverse takeover of Apollo, per the filing.
Apollo cited WM Motor and its affiliates’ potential in increasing market access to the smart electric vehicle segment in China, its potential in expanding to the global market, as well as the ability to tap into the luxury vehicle market in China and beyond are among the reasons that drive the acquisition.
However, the timeline of the acquisition and completion of share placement is still subject to uncertainty and a slew of factors, including regulatory approvals and market conditions, the filing said.
The deal comes around two months after local media Caixin reported that WM Motor is slashing salaries by half for the management and nearly 30% for its staff, as the firm continues to struggle amid slackened sales and growing losses.
In June 2022, the firm reportedly filed its pre-listing documents with the Hong Kong stock exchange, joining a slew of its counterparts, including NIO, XPeng, Li Auto, and Zhejiang Leapmotor Technology, per Bloomberg.
Founded in 2015, WM Motor produces EVs in eastern China’s Wenzhou city, Zhejiang province, in a facility equipped with mass customisation capabilities and a capacity of delivering 100,000 units per year. WM Motor and its affiliates sold a total of 44,152 units of EVs, which was “more than double” that of 2020, the filing said.