Ecarx Holdings has secured a $45.6 million strategic investment from Geely Holding. The automotive technology provider signed a subscription agreement with the Chinese automotive conglomerate.
Geely will invest through a private placement. It has agreed to subscribe for approximately 27.29 million newly issued Class A ordinary shares. The price is set at $1.67 per share.
The issue price reflects the volume-weighted average price of Ecarx's ordinary shares on Nasdaq over the 20 consecutive trading days before the agreement was signed. Completion of the private placement is expected soon, pending customary closing conditions.
The Class A ordinary shares issued to Geely will be subject to a six-month lock-up period, with certain customary exceptions.
Ecarx CEO and chairman Ziyu Shen stated, "Following the two project wins from Volkswagen Group last year and our deepened strategic partnership with Lotus Tech, this investment will support the build out of our R&D hub in Germany and infrastructure across key growth markets in South America and Southeast Asia, providing us with the R&D, delivery, and supply chain capabilities to fuel our global expansion."
Ecarx said the net proceeds will be used to accelerate development of its vehicle hardware and software offerings. The company also plans to expand global deployment as part of its growth strategy while strengthening its financial position and liquidity.
Following completion, Ecarx will issue new Class A ordinary shares to Geely Holding as part of the transaction.
Geely Holding executive vice chairman Daniel Donghui Li added, "Ecarx has established itself as a key technology partner in the global automotive industry, and this investment underscores Geely's continued confidence in the company's long-term vision and technological capabilities."
In October last year, Ecarx signed a new partnership agreement with Victory Giant Technology Company (VGT) as it sought to scale up its capabilities to meet growing global demand for high-performance computing platforms for next-generation vehicles.