Chinese automaker GAC Group agreed to increase the capital of joint venture company GAC NIO by introducing strategic investors, totaling about 2.405 billion yuan ($370 million), according to a statement released by the company on January 5.
GAC Group, through its wholly-owned subsidiary GAC Aion, increased its capital in GAC NIO by approximately RMB 482 million, and Guangdong Zhujiang Investment Smart Technology Investment Co., Ltd. increased its capital as a strategic investor by approximately RMB 1.923 billion.
After the completion of the capital increase, GAC Group and its wholly-owned subsidiary GAC Aion hold a total of 25% equity in GAC NIO.
Last month, Chinese media reported that Beijing government officials had visited GAC NIO to discuss investment plans with the company's founder and CEO, Liao Bing.
If the negotiations go well, GAC NIO's headquarters or a new production facility is expected to relocate to Beijing, the report said.
GAC NIO did not deny the news, saying only that it is not allowed to reveal too many details at this stage and that there will be an official disclosure in 1 month and it will involve a relatively big deal.
GAC NIO was founded in 2018 as a joint venture between GAC Group and NIO, a car brand. Previously, GAC Group was 45% owned by its related parties, and NIO and its related parties, and GAC NIO and its related parties held only 10% of the shares.