Chinese electric vehicle manufacturer "NIO" announced today, Tuesday, that "CYVN Holdings", backed by the Abu Dhabi government, will invest approximately $738.5 million in the company as it seeks to strengthen its balance sheet. "NIO", along with "Xiaopeng" and "Li Auto", is among the companies competing to increase their shares in the largest electric vehicle market in the world, which is dominated by "BYD".
Under the agreement, NIO will issue around 85 million new Class A shares at a price of $8.72 per share in favor of "CYVN Holdings". This news led to a decline in NIO's shares listed in the United States by about one percent to $9.30. Additionally, "CYVN Holdings" has entered into an agreement with an affiliate of "Tencent Holdings" to obtain some shares of "NIO".
After completing the two transactions, "CYVN" will hold a 7% stake in NIO, according to statements from the Chinese company, which added that holding this stake will allow the investment company to nominate one member to NIO's board of directors. NIO's electric vehicle deliveries increased by 20% in the first quarter, with 25,768 vehicles delivered to customers in the same quarter last year.
