Nio boosts size of share sale amid electric-car stock frenzy

The some $1.5 billion raised in Nio’s latest offer will be partly used to increase the company’s interest in Nio China.
By : Bloomberg
| Updated on: 01 Sep 2020, 12:39 PM
The new Nio ES8. (Photo courtesy: Twitter/@NIOGlobal)
The new Nio ES8. (Photo courtesy: Twitter/@NIOGlobal)
The new Nio ES8. (Photo courtesy: Twitter/@NIOGlobal)
The new Nio ES8. (Photo courtesy: Twitter/@NIOGlobal)

China’s Nio Inc. boosted the size of its capital raising by almost 20% as investors rush stock sales by electric vehicle makers.

The US-listed, Shanghai-based firm sold 88.5 million American depository receipts at $17 apiece, according to an emailed statement Monday. It initially planned to sell only 75 million shares.

Investors are showing an increased interest in clean-energy car companies. Stock in Tesla Inc. has surged this year, making founder Elon Musk a centibillionaire with a net worth of $104 billion. Li Auto Inc., another Chinese EV maker, raised $1.1 billion in late July while XPeng Inc. had a stellar debut last week.

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The some $1.5 billion raised in Nio’s latest offer will be partly used to increase the company’s interest in Nio China. Funds will also be spent on R&D into autonomous driving technologies as well as other general corporate purposes.

(Also read: Chinese electric car brand NIO looks at expansion abroad)

Nio’s once-shaky financial position is looking stronger. Earlier this year, it got a $1 billion investment from the city of Hefei in eastern China, where it operates a factory. The firm also reported a positive gross margin for the first time in the second quarter.

Morgan Stanley, China International Capital Corp. and BofA Securities Inc. underwrote the offering.

First Published Date: 01 Sep 2020, 12:39 PM IST
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