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Malay Mail
3 days ago
- Automotive
- Malay Mail
Zeekr investors hit out at Geely's US$2.2b privatisation plan, say EV maker worth more than Nio, Xpeng, Li Auto
Five early investors, including CATL and Intel Capital, have sent letters Say offer values Zeekr far lower than some peers despite better prospects Geely plans to merge Zeekr into Geely Auto unit HONG KONG/SHANGHAI, May 30 — China's Geely is undervaluing its premium electric car unit Zeekr with the US$2.2 billion take-private offer it has made, five early investors in Zeekr have written to its board, according to three sources with direct knowledge of the matter. The investors, including Contemporary Amperex Technology Co Ltd (CATL), Intel Capital and Boyu Capital, who invested in Zeekr's maiden fundraising round, have sent two letters written jointly to the company and a special committee formed to assess the offer, saying that the privatisation price was too low to reflect the fair value of Zeekr, the sources told Reuters. Geely, one of China's most globally known automakers due to its purchase of foreign marquees such as Volvo and Proton, offered on May 7 to privatise Zeekr, saying it wanted to fully merge Zeekr into Geely Auto. Geely Auto owns about two-thirds of Zeekr. Both companies sit under the umbrella of their unlisted parent, Geely Holding. Geely founder and chairman Eric Li also chairs the Zeekr board. The move surprised the market and the auto industry, given how it came just a year after it took the EV brand public in the United States. It has also raised questions on the prospects of two other Geely units preparing for Hong Kong listings, including ride-hailing firm CaoCao Inc, and raised questions over whether Geely might delist its other US-listed units such as Polestar . The other two investors who wrote the letters were Bilibili and Cathay Fortune Corp. A spokesperson for Geely said that talks with Zeekr's special committee were ongoing. Zeekr, CATL, Intel Capital, Boyu Capital, Cathay Fortune did not respond to requests for comment. Bilibili declined to comment. The offer is non-binding according to Geely Auto's filing. A binding commitment will only arise upon the execution of definitive agreements, subject to the terms and conditions, it said. Improving the strategic focus Li has pivoted Geely away from its history of aggressive acquisitions to streamlining operations and cutting costs amid a brutal price war in China's auto market, the world's biggest. He launched last year a campaign to improve the group's strategic focus and eliminate internal competition, which has so far involved it restructuring its brands into two units and merging some teams that were working on digital cockpit technology. Zeekr is now viewed as Geely's best asset – sales of the brand reached 41,403 units in the first quarter of this year with six models, increasing 25 per cent from a year ago and outselling BYD's premium brand Denza. The five investors said in the first letter they sent last week that the privatisation price only valued Zeekr at US$6.5 billion, much lower than peers such as Li Auto, Nio and Xpeng, according to the three sources. They said Zeekr has a better cash flow and profitability prospects than these peers, and urged the deal should only proceed after obtaining the agreement of the majority of the 'independent minority' shareholders. Two of the sources said the investors sent a second letter this week, reiterating what they said in the first letter and urging the Zeekr special committee to carefully review and evaluate the offer. The five investors took part in Zeekr's first external fundraising round of US$500 million that valued it at US$9 billion in 2021. At the time, they together held a 6 per cent stake in the company. A subsequent fundraising round valued the EV maker at US$13 billion in 2023 but a year later it went public at a valuation of US$5.5 billion on a fully diluted basis, less than half of the pre-IPO figure. Two of the sources said Y2 Capital, an investor in Zeekr's IPO, had sent a similar letter voicing concerns to Geely's leadership. Y2 Capital did not respond to a request for comment. Geely's offer of US$25.66 per American Depository Share of Zeekr represented a 24 per cent premium to its average share price over the four weeks prior to the offer announcement. The average premium paid in US take-private deals has been about 40 per cent since 2023, according to LSEG data. Zeekr shares are now trading above the offer price and last closed at US$26.59. However, analysts said that Geely Auto may have sufficient votes to carry out the privatisation without the need for other shareholder approvals given its 65.7 per cent stake in Zeekr. — Reuters
Reuters
3 days ago
- Automotive
- Reuters
Exclusive: Zeekr investors criticise Geely's $2.2 billion take-private bid as inadequate, say sources
HONG KONG/SHANGHAI, May 30 (Reuters) - China's Geely is undervaluing its premium electric car unit Zeekr (ZK.N), opens new tab with the $2.2 billion take-private offer it has made, five early investors in Zeekr have written to its board, according to three sources with direct knowledge of the matter. The investors, including Contemporary Amperex Technology Co Ltd (CATL) ( opens new tab, Intel Capital and Boyu Capital, who invested in Zeekr's maiden fundraising round, have sent two letters written jointly to the company and a special committee formed to assess the offer, saying that the privatisation price was too low to reflect the fair value of Zeekr, the sources told Reuters. Geely, one of China's most globally known automakers due to its purchase of foreign marquees such as Volvo ( opens new tab and Proton, offered on May 7 to privatise Zeekr, saying it wanted to fully merge Zeekr into Geely Auto ( opens new tab. Geely Auto owns about two-thirds of Zeekr. Both companies sit under the umbrella of their unlisted parent, Geely Holding. Geely founder and chairman Eric Li also chairs the Zeekr board. The move surprised the market and the auto industry, given how it came just a year after it took the EV brand public in the United States. It has also raised questions on the prospects of two other Geely units preparing for Hong Kong listings, including ride-hailing firm CaoCao Inc, and raised questions over whether Geely might delist its other U.S.-listed units such as Polestar . The other two investors who wrote the letters were Bilibili ( opens new tab and Cathay Fortune Corp. A spokesperson for Geely said that talks with Zeekr's special committee were ongoing. Zeekr, CATL, Intel Capital, Boyu Capital, Cathay Fortune did not respond to requests for comment. Bilibili declined to comment. The offer is non-binding according to Geely Auto's filing. A binding commitment will only arise upon the execution of definitive agreements, subject to the terms and conditions, it said. Li has pivoted Geely away from its history of aggressive acquisitions to streamlining operations and cutting costs amid a brutal price war in China's auto market, the world's biggest. He launched last year a campaign to improve the group's strategic focus and eliminate internal competition, which has so far involved it restructuring its brands into two units and merging some teams that were working on digital cockpit technology. Zeekr is now viewed as Geely's best asset - sales of the brand reached 41,403 units in the first quarter of this year with six models, increasing 25% from a year ago and outselling BYD's ( opens new tab premium brand Denza. The five investors said in the first letter they sent last week that the privatisation price only valued Zeekr at $6.5 billion, much lower than peers such as Li Auto ( opens new tab, Nio ( opens new tab and Xpeng ( opens new tab, according to the three sources. They said Zeekr has a better cash flow and profitability prospects than these peers, and urged the deal should only proceed after obtaining the agreement of the majority of the "independent minority" shareholders. Two of the sources said the investors sent a second letter this week, reiterating what they said in the first letter and urging the Zeekr special committee to carefully review and evaluate the offer. The five investors took part in Zeekr's first external fundraising round of $500 million that valued it at $9 billion in 2021. At the time, they together held a 6% stake in the company. A subsequent fundraising round valued the EV maker at $13 billion in 2023 but a year later it went public at a valuation of $5.5 billion on a fully diluted basis, less than half of the pre-IPO figure. Two of the sources said Y2 Capital, an investor in Zeekr's IPO, had sent a similar letter voicing concerns to Geely's leadership. Y2 Capital did not respond to a request for comment. Geely's offer of $25.66 per American Depository Share of Zeekr represented a 24% premium to its average share price over the four weeks prior to the offer announcement. The average premium paid in U.S. take-private deals has been about 40% since 2023, according to LSEG data. Zeekr shares are now trading above the offer price and last closed at $26.59. However, analysts said that Geely Auto may have sufficient votes to carry out the privatisation without the need for other shareholder approvals given its 65.7% stake in Zeekr.
Yahoo
08-05-2025
- Business
- Yahoo
SKP Beijing to Sell 42 to 45 Percent Stake to Boyu Capital
SKP Beijing, China's top-grossing luxury department store operator, is slated to sell around 42 to 45 percent of the company to Boyu Capital, according to a notice posted on the Beijing Municipal Bureau of Market Supervision and Administration's website. According to the notice, through its affiliated entities Boyu Capital's fifth and largest U.S. dollar-denominated fund plans to acquire a partial stake in SKP Beijing, or Beijing Hualian Department Store Co. Ltd. Following the transaction, the Boyu-affiliated entity will indirectly hold a 42 to 45 percent equity stake in Beijing SKP as a financial investor. The notice, which was quietly published on April 30, will remain publicly available until Friday. More from WWD EXCLUSIVE: More Executive Changes for Flos B&B Group as Arclinea Family CEO Steps Down Luxury Grapples With Disillusionment and Fragile Recovery in China Chiara Ferragni Takes Full Control of Namesake Brand The notice revealed that Radiance Investment Holdings Pte. Ltd. and Hualian Group own 60 percent and 40 percent of SKP Beijing, respectively, before the Boyu transaction. After the transaction, Radiance Investment Holdings will continue to indirectly hold a 42 to 45 percent stake in the company and retain control of the luxury retailer, the notice said. Radiance Investment Holdings will likely retain its directly held 10 percent stake in the company, according to SKP's company structure published by the search platform Tianyancha. SKP Beijing's operational and management structure will remain unchanged, according to the notice. The luxury department store was founded in 2006 by Hualian Group and an individual investor, according to the notice. 'The individual is mainly involved in investment activities, while Hualian Group operates primarily in the domestic retail sector,' the notice said. According to Tianyancha, SKP Beijing currently has three shareholders. Radiance Investment Holdings owns 60 percent of the retailer, with 50 percent of that stake held via Ruide Fashion (Beijing) Commercial & Trading Co. Ltd., while Hualian Group owns the remaining 40 percent. The notice also disclosed Beijing SKP's market share in the domestic department store market. In 2024, SKP Beijing's market shares in Beijing, Xi'an, Chengdu and Wuhan were around 10 to 15 percent, 15 to 20 percent, 10 to 15 percent and 0 to 5 percent, respectively. The details of the transaction with Boyu were not disclosed in the notice, however, previous local media reports put a $4 billion to $5 billion price tag on the SKP business. SKP Beijing did not respond to a request for comment at the time of publication. Boyu Capital is a Chinese private equity firm founded in 2011 by Louis Cheung, former chief financial officer of Ping An Insurance; Alvin Jiang, the grandson of China's former president Jiang Zemin; Mary Ma, a former partner at TPG Capital, and Sean Tong, formerly of General Atlantic. The firm quickly gained prominence through a series of high-profile backings, including from Alibaba, Xiaomi, and TikTok's parent company ByteDance. Boyu operates both renminbi and U.S. dollar-denominated funds, which has helped global investors — such as Singapore's state-owned Temasek Holdings, Hong Kong business magnate Li Ka-shing and the New York State Common Retirement Fund — among others, access to investment in China and the broader APAC region. In 2021, its fifth U.S. dollar fund was established in Singapore and raised a record $6.8 billion, becoming the largest U.S. dollar fund operating in China at the time, according to local media reports. Radiance Investment Holdings was founded in 2011 in Singapore; the entity, which primarily engages in investment activities, is controlled by a private individual. SKP Beijing, China's biggest and most productive retailer in 2019, according to press reports at the time became the world's most profitable mall in 2020 after beating Harrods with annual sales of 17.7 billion renminbi, or around $2.46 billion. In 2023, sales reached a record high of 26.5 billion renminbi, or $3.68 billion, in revenue. However, amid ongoing macroeconomic challenges that have dampened consumer confidence and with travel retail making a comeback, sales at SKP reportedly dropped 17 percent year-over-year to 22 billion renminbi, or $3.06 billion, in 2024. According to local media reports, in the first quarter of 2025, sales at SKP Beijing rose 18 percent year-over-year. Apart from its Beijing flagship, Beijing SKP operates three other branches, including Xi'an SKP, Chengdu SKP and Wuhan SKP. Future projects in Guangzhou and Hangzhou are in the works. Best of WWD Tailoring Black Style: Celebrating Iconic Black Male Figures in Fashion Kate Middleton and Prince William's 14 Most Iconic Matching Moments: A Celebration of Style and Love 14 Cutest Kate Middleton and Prince William's Look-alike Couple Style Moments [PHOTOS] Sign in to access your portfolio
