On June 20, The Business Times learned that NIO has signed a share subscription agreement with Abu Dhabi investment firm CYVN Holdings. According to the agreement, CYVN Holdings will make a strategic investment of approximately $1.1 billion in NIO through a combination of a targeted issuance of new shares and transfer of old shares.
CYVN Holdings is an investment institution in which the Abu Dhabi government holds the majority stake. It focuses on strategic investments and deployments in advanced, intelligent mobility, and is committed to collaborating with global industry leaders in the field.
Per the agreement, CYVN will issue 8.47 million Class A ordinary shares at $8.72 per share (the weighted average price of Class A ordinary shares on the New York Stock Exchange over seven consecutive trading days before June 19, 2023). The total investment is $738.5 million and is expected to be completed by early July 2023.
Meanwhile, CYVN has signed a share purchase agreement with an affiliate of Tencent (referred to as "existing shareholders"), per which CYVN will purchase about 4.01 million Class A ordinary shares held by the existing shareholders (referred to as "secondary share transfer").
After the targeted issuance of new shares and the transfer of old shares, CYVN will hold about 7.0% of NIO's issued and outstanding shares.
Upon completion of the investment transaction, CYVN will have the right to appoint a director to the company's board.
NIO's founder, chairman, and CEO, Li Bin, said the strategic investment by CYVN reflects NIO's unique value in the smart electric vehicle industry. The investment deal will further strengthen NIO's balance sheet, fueling its ongoing efforts to accelerate business growth, drive technological innovation, and establish long-term competitiveness.
Li Bin also expressed anticipation for a future expansion of NIO's international business in cooperation with CYVN.
Jassem Al Zaabi, Chairman and Managing Director of CYVN Holdings, stated that their strategic investment in NIO stems from their high regard for NIO's leading brand status in the smart electric vehicle market, innovative high-end products, and technical capabilities. They are excited to establish a strategic partnership with NIO, providing strategic support for NIO's international business growth. They plan to join hands with NIO to promote global energy transformation and sustainable development of human society.
NIO's U.S. stock rose in pre-market trading, narrowing the decline to 1.17%, after previously falling more than 5%.
