Geely is taking a 30% stake in NIO Power, NIO’s battery-swapping and charging unit, through a deal valuing the business at about RMB16 billion ($2.37 billion). Under definitive agreements announced on September 28, a Geely subsidiary will contribute its entire ownership of Yiyi Power, its commercial battery-swapping business, plus RMB640 million ($94.8 million) in cash in exchange for newly issued shares in NIO Power.
The structure means Geely is not paying NIO RMB4.8 billion for an existing 30% stake. At the stated post-money valuation, 30% of NIO Power corresponds to roughly RMB4.8 billion, but most of that value is represented by Yiyi Power rather than cash. After closing, NIO China will retain a controlling 63.6% stake in NIO Power, while Geely will own 30% and existing investor Wuhan Guangchuang Emerging Technology Phase I Venture Capital Fund will hold the remaining 6.4%.
Geely’s stake is partly tied to operational milestones and can be reduced if targets are missed, although it cannot fall below 20%. Geely also has an option to invest another RMB640 million in cash within two years of closing or before NIO Power signs binding documents for another financing round, whichever comes first. If exercised without milestone adjustments, Geely’s ownership would rise to 34% and NIO China’s controlling stake would decline to 60%. The transaction still requires regulatory clearances and other customary closing conditions.
NIO founder and CEO William Li framed the partnership as a way to reduce duplicated infrastructure spending and improve efficiency across China’s EV industry rather than requiring each manufacturer to build a fully independent network. NIO said it had invested more than RMB20 billion in charging and battery-swapping technology and infrastructure as of September 27. It currently operates 4,126 battery-swap stations and 5,307 charging stations in China, and NIO Power is targeting 10,000 swap stations by 2030.
The companies are also exchanging exposure to their charging businesses. NIO China has agreed to subscribe for newly issued shares representing 10% of Geely subsidiary Zhejiang Haohan Energy Technology, which will then use the cash consideration to purchase certain charging assets from NIO. The companies have not disclosed how much NIO will invest in Haohan Energy or the value of the charging assets Haohan will acquire, so the transaction’s overall net cash benefit to NIO is not yet clear.
NIO’s U.S.-listed shares closed Monday at $3.595, up 0.42%, after opening at $3.64. The stock has been under pressure, having dropped to $3.50 last week, its lowest level since July last year and 55% below its highest point this year. Investors are also watching NIO’s third-quarter delivery data, with guidance for between 108,000 and 111,000 deliveries, representing about 25% annual growth. In its last earnings report, NIO said vehicle deliveries rose to 107,658 from 72,056 a year earlier, vehicle revenue jumped to $4.28 billion, and vehicle margin reached 18.5%, above Tesla’s 16.3%. NIO’s cash and equivalents rose to more than $8.4 billion.
Technical analysis suggests NIO shares have been in a strong downtrend, falling from a high of $7 in April to around $3.58. The stock broke below support at $4.37 and the psychological $4 level, but the MACD indicator has formed a bullish crossover and the Relative Strength Index has moved above oversold territory, suggesting a possible rebound toward the $4.37 resistance level.
