Nio’s stock turns briefly positive after more than $1 billion investment from Abu Dhabi fund

skippix
2023-06-21

The U.S.-listed shares of Nio Inc. bounced briefly into positive territory Tuesday, after the China-based electric vehicle maker announced an investment of more than $1 billion by an investment fund majority owned by the Abu Dhabi government.

Nio $NIO Inc.(NIO)$ said CYVN Holdings LLC has entered into a share subscription agreement in which the fund will invest a total of $738.5 million in cash to own about 84.70 million newly issued shares of Nio at a purchase price of $8.72. The closing of the agreement is expected to take place in early July.

Nio’s stock initially dipped in premarket trading following the CYVN investment announcement, as the share purchase price from the company represented a 7.2% discount to Friday’s closing price of $9.40. It then bounced to be up as much as 0.1% at an intraday high of $9.41, before pulling back into negative territory.

I like Nio too and their models. I hopre they keep making right decisions and focus on what’s important. production and deliveries!

Yes, they blow through 744m USD in a qr. that still isn’t great because if you do the math that’s about the same amount, in USD, that this Abu Dhabi company invested (738.5m USD). So it just gives 1 more qr runway, which isn’t a lot on the grand scheme of operations. If they had lower operating costs then an investment like this would be even more exciting.

It’s still good to have more investors on board. They could potentially push deliveries and cost optimization. Nio in Abu Dhabi makes sense because there’s a lot of wealth there too. And the more global they can become the higher chances they can be in USA. They have a better global strategy than any of the other new EV makers in China that beat them in deliveries.

But this isn’t a breaking amount of money.

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