Volkswagen Group China soon to become Gotion High-Tech's biggest shareholder

Shanghai (Gasgoo)- Gotion High-Tech Co.,Ltd., announced on Monday will make a non-public issuance of 384,163,346 shares to Volkswagen (China) Investment Co.,Ltd. (called "VW China" for short), and it has completed registration for the new stocks to be issued, which will be put into the public market for transaction on Dec. 15.

Photo credit: Gotion High-Tech

Priced at 19.01 yuan ($2.99) per share, the stock issuance is set to raise around 7.303 billion yuan ($1.148 billion), which will be used to build power battery industrialization facilities and cathode material manufacturing plants, and supplement working capital.

Gotion High-Tech's chairman Li Zhen and the company's current controlling shareholder Nanjing GuoXuan Holding Group Co., Ltd. will transfer some of their shares to VW China as well.

According to the announcement, upon completion of the non-public issuance and the share transfer, VW China will become the biggest shareholder of Gotion High-Tech by holding 26.47% stake.

Meanwhile, Gotion High-Tech's current actual controller—Li Zhen and his persons acting in concert, will drop to the second largest one with their combined share percentage shrinking to 18.17%.

The power battery manufacturer announced in May 2020 it intended to introduce VW China as a strategic investor. Under the agreement signed then, Gotion High-Tech would make a private placement, equivalent to 30% of its total share capital issued prior to the placement, to VW China, raising a total of no more than 7,306,207,300 yuan ($1.148 billion). Besides, Nanjing GuoXuan Holding Group Co., Ltd. and Li Zhen would also transfer approximately 5% share capital they hold in Gotion High-Tech to VW China.

In July 2021, Volkswagen Group and Gotion High-Tech deepened their partnership. Both parties agreed to team up on fast cell industrialization at the Volkswagen-owned Salzgitter plant with Gotion High-Tech acting as technology partner for the cell factory layout, machinery, and production processes.

In addition, VW China and Hefei Gotion High-Tech Power Energy Co., Ltd. (a wholly-owned subsidiary of Gotion High-Tech) agreed that Gotion High-Tech would develop the VW's first generation of unified cells for the volume segment.