China’s third-largest property developer, Evergrande Group, has paid $930 million to become a controlling shareholder of EV maker National Electric Vehicle Sweden (NEVS).
The move comes as part of Evergrande founder Hui Ka-yan’s ambitions to diversify the company’s business portfolio and tap into a burgeoning electric vehicle market.
NEVS acquired the main assets of Swedish manufacturer Saab when the company closed its doors in 2012. This included the firm’s Trollhättan factory where NEVS now produces electric vehicles based on the final generation of Saab’s 9-3 saloon. A 2012 attempt to obtain the rights to Saab’s branding and logo on its vehicles was unsuccessful.
The company is part-owned by the municipal government of Tianjin in north-eastern China, where a second facility with a capacity of 50,000 units per year began producing 9-3-based EV models for the Chinese market in 2017.
The deal between NEVS and Evergrande will aid development of a planned electric crossover, the 9-3X EV, which will initially be produced for China but could make a European debut as part of the company’s aims to become one of the industry’s biggest producers of EVs.
A similar deal, worth $2 billion, between Evergrande and American EV start-up Faraday Future was threatened last year by a dispute over claims of withheld funding and attempted control seizure on the part of the investor.
A new contract drawn up by the two companies at the end of 2018 is anticipated to bring an end to a period of uncertainty for the Los Angeles-based manufacturer.
An Evergrande spokesperson, quoted in the South China Morning Post, said: “Through acquiring corporations possessing leading new energy automotive technology and production capacity, the board believes that the group’s growth capabilities can be strengthened, and a strong competitiveness in the fast-growing new energy automotive industry can be obtained”.