Tianqi has acquired a 2.83 percent stake in Smart, giving the Mercedes-Geely JV a valuation of $5.3 billion.
(Image credit: CnEVPost)
Chinese lithium giant Tianqi Lithium has taken a stake in Mercedes-Geely joint venture Smart, further expanding its presence in the electric vehicle (EV) industry chain.
Tianqi's board of directors meeting on July 13 approved a decision on the company's participation in Smart's Series A equity financing for $150 million, which will subscribe for 17,605,633 Class A ordinary shares of the latter, according to an exchange announcement by the Shenzhen-listed company.
Smart plans to raise a total of $250 million to $300 million in the Series A financing round, in which Tianqi is the lead investor, according to the announcement.
Prior to Tianqi's investment, Mercedes-Benz held a 46 percent stake in Smart, Geely's offshore subsidiary Sunrise Mobility Limited held a 41.4 percent stake, and another Geely affiliate, ZMD Capital Ltd, held a 4.6 percent stake. Other shareholders and reserved shares are 8 percent, according to the announcement.
Tianqi acquired a 2.83 percent stake in Smart through the investment, reducing Mercedes-Benz's stake to 43.397 percent, Sunrise Mobility Limited to 39.057 percent and ZMD Capital Ltd to 4.340 percent.
That means Smart is valued at $5.3 billion in the fundraising.
Investing in vehicle companies downstream of the new energy vehicle (NEV) industry chain expands new reach and feedback for the company to launch its business, and is in line with the company's vertically integrated development strategy, Tianqi said.
Geely and Mercedes-Benz officially announced the establishment of the 5.4 billion yuan ($783 million) Smart joint venture in Hangzhou Bay, Ningbo, in early 2020.
As part of the agreement, Mercedes-Benz designers will design the smart cars of the future and Geely will engineer them.
Smart currently has two models on sale in China, the Smart #1, which went on sale in China on April 25, 2022 with deliveries beginning on September 24, and the Smart #3, which went on sale in China on June 1 with deliveries beginning on June 20.
In June, Smart delivered 3,829 vehicles in China, an increase of nearly 46 percent over May. In the first half of the year, the total number of Smart vehicles delivered in China was 23,540.
Deliveries of the Smart #1 have already begun in Germany and France, and there are plans to make it available for delivery in other European markets, according to Tianqi's announcement.
The stake in Smart is the latest move by Tianqi to expand its presence in the EV chain.
In August 2022, Tianqi formed a joint venture with Nio's semi-solid-state battery supplier Beijing WeLion New Energy Technology, which is involved in materials research and development and power battery recycling.
A Shenzhen-based subsidiary of Tianqi holds a 58.5 percent stake in the joint venture, with WeLion holding 41.5 percent, information from data provider Tianyancha showed.
WeLion began delivering 360 Wh/kg semisolid battery cells to Nio on June 30, and held a delivery ceremony in Huzhou, Zhejiang province, where its manufacturing base is located.