JAC did not give a specific reason, but said the move will help it deepen its strategic partnership with NIO.
(Image credit: CnEVPost)
NIO's (NYSE: NIO) manufacturing partner Anhui Jianghuai Automobile Group Corp (JAC) plans to acquire some of its construction-in-progress assets for reasons unknown, though the company said it would help strengthen their cooperation.
JAC plans to acquire some of the assets of NIO Anhui's construction-in-progress and equipment installation projects for an estimated price of 1.704 billion yuan ($244 million), it said in an exchange announcement today.
JAC said the move is based on a long-term strategic partnership it has established with NIO and is for the purpose of jointly promoting cooperation in new energy vehicle manufacturing.
The asset acquisition will not affect JAC's normal production and operations, and if the transaction goes through, it will facilitate its deepening strategic cooperation with NIO, the company said.
JAC still needs to sign a contract with NIO Anhui after the decision-making process, and there is uncertainty about whether the contract will be signed, the announcement noted.
The assets will be transferred to JAC within 10 days after the contract between the two is signed, according to the announcement.
NIO's vehicles are currently manufactured at two plants in Hefei, Anhui province, including its F1 plant with JAC, and its F2 plant at NeoPark.
On March 4, 2021, JAC said it signed a letter of intent with NIO to establish a joint venture company, Jianglai Advanced Manufacturing Technology (Anhui) Co, a name that takes the first character of JAC's Chinese name and the second character of NIO's Chinese name.
Jianglai's planned registered capital was RMB 500 million, with JAC contributing 51 percent and NIO 49 percent.
On March 27, 2021, NIO signed a contract with JAC to establish the company. The two companies will deepen manufacturing cooperation to optimize operating costs, and improve operational efficiency and management capabilities, Shen Feng, executive vice president of NIO, said at the time.
On March 31, 2021, Jianglai was officially established with a registered capital of RMB 500 million, owned 49 percent by NIO and 51 percent by JAC.
On March 14 this year, Jianglai's registered capital was increased by 4.08 percent from RMB245 million to RMB255 million, and NIO's shareholding was increased from 49 percent to 50 percent.
Jianglai's business scope was also expanded at that time, from previously including smart electric vehicle production and supply chain management to more projects including motor vehicle production.