Saudi PIF could invest at least $250 million in Human Horizons at a valuation of $3 billion, and a deal could be reached as early as this year, according to Bloomberg.
(Image credit: CnEVPost)
Human Horizons, the Chinese premium electric vehicle (EV) maker that owns the HiPhi brand, is reportedly in talks with Saudi capital for an investment, as a number of local new car makers receive backing from international investors.
Saudi Arabia's sovereign wealth fund, the Public Investment Fund (PIF), is in talks to invest at least $250 million in Human Horizons as part of the kingdom's efforts to build up its domestic auto industry, Bloomberg said in a November 7 report, citing people familiar with the matter.
The PIF could take a stake in the Shanghai-based company at a valuation of $3 billion, and a deal could be reached as early as this year, according to the report.
For reference, another Chinese premium EV maker, Nio (NYSE: NIO), currently has a market capitalization of $14 billion.
Human Horizons is considering raising as much as $1 billion from private investors to fuel growth, the report said.
The EV maker launched the HiPhi X, the first model under the HiPhi brand, in October 2020, with deliveries of the model beginning in May 2021 in China.
The HiPhi X starts at RMB 570,000 ($78,330) for the six-seat version and up to RMB 800,000 for the four-seat version.
Its second model, the HiPhi Z, was released in August 2022, when it was priced at a starting price of RMB 610,000 yuan. Last month, a new variant of the HiPhi Z was released with a starting price reduced by RMB 100,000.
On July 15, HiPhi launched the HiPhi Y, making it the brand's least expensive model, which now has a starting price of RMB 339,000
Notably, Saudi Arabia's Ministry of Investment signed a $5.6 billion agreement with Human Horizons in June to collaborate on the development, manufacture and sale of automobiles.
The agreement accounted for more than half of the more than $10 billion in investments signed on the first day of the Arab-China business conference in Riyadh, a Reuters report at the time noted.
Saudi Arabia has been pushing for increased investment in the non-oil sector as part of its diversification agenda. Part of its plan is to develop domestic EV manufacturing, the report said.
As China's EV sector grows rapidly, local companies with innovative technologies are being favored by international investors.
On July 26, Volkswagen entered into an agreement with Xpeng (NYSE: XPEV) to invest about $700 million in the latter to acquire about 4.99 percent of its equity.
Volkswagen will co-develop two B-segment all-electric vehicles to be marketed in China under the Volkswagen brand, based on the Xpeng G9 platform.
On October 26, Leapmotor said Stellantis would invest 1.5 billion euros ($1.58 billion) in it for a roughly 20 percent stake.
Leapmotor and Stellantis will plan to form a joint venture called Leapmotor International, which will accelerate and expand global sales of Leapmotor's products by leveraging Stellantis' global resources.
($1 = RMB 7.2766)
