FILE PHOTO: NIO ES8 electric SUVs are seen displayed at the second media day for the Shanghai auto show in Shanghai, China April 17, 2019. REUTERS/Aly Song
BEIJING (Reuters) – Strategic investors will inject 7 billion yuan ($989 million) into Nio China, a new entity controlled by Chinese electric vehicle maker Nio Inc, the firm said on Wednesday.
The new investment will boost product development and research, Chief Executive William Li told a news conference, adding that the firm would consider expanding capacity in the eastern city of Hefei if sales demand grew.
In a statement, the firm said Nio will inject its core businesses and assets in China, which are valued at 17.77 billion yuan, into Nio China and invest 4.16 billion yuan in it.
Nio will hold 75.9% of the new firm, and investors the rest, once transactions are completed.
The headquarters of Nio China are planned to be located in the Hefei Economic and Technological Development Area.
In February, Nio said it signed framework agreements with the Hefei city government to raise funds in excess of 10 billion yuan.
Nio plans further developments along with the Hefei government, Li added, but did not elaborate.
Reporting by Yilei Sun and Brenda Goh; Editing by Clarence Fernandez