China’s private firm Qingdao Wudaokou New Energy Industrial Fund has announced the acquisition of stakes in the units of Chinese automaker Chery Group, per a company filing on its official Weibo account on Wednesday.
Qingdao Wudaokou closed the deal at about 14 billion yuan ($2 billion). Qingdao Wudaokou will acquire 30.99 per cent stake in Chery Holding and 18.5185 per cent stake in Chery Automobile, according to the announcements on the Changjiang Equity Exchanges (CEE).
As part of the deal, Qingdao Wudaokou acquired a total of 20.01 per cent stake from existing shareholders Huatai Asset Management and Ruichuang Investment Holding, according to local media reports.
Chery Holding is the majority stakeholder in Chery Automobile with 32.4815 per cent stake.
Headquartered in Qingdao, Qingdao Wudaokou was founded in August just four months before the deal.
Per its recent press release, from January to October 2019, Chery sold a total of 577,000 vehicles, among which the sales of its independently-developed models increased 6.7 percent year-on-year. In October, sales of Tiggo8 reached 13,152 units, with a monthly growth of 10.6 percent and a yearly growth of 80.2 percent.
Set up in 1997, Chery Automobile has enhanced its focus on green energy and intelligent automobiles in line with global trends. In 2018, it launched its CheryLion strategy covering five themes including driverless vehicles, cloud-based internet, AI manufacturing, digital marketing and smart mobility.
China is the largest electric vehicle market in the world with local brands accounting for 94 per cent market share, a McKinsey report noted. Top Chinese EV makers include Chery, BYD, NIO, Changan, WEY, and Zotye Auto.