in

Car Inc may soon exit the Charles Lu family · TechNode


Car Inc may soon have no more formal ties to Charles Lu, founder of Luckin, Car Inc, and Ucar.

China’s Beijing Automotive Group (BAIC) is seeking to buy a stake of up to 21.26% in Car Inc, a Hong Kong-listed car rental company formed by Luckin Coffee chairman Charles Lu. Shares of Car Inc surged 24.4% to close at HKD 2.24 ($0.29) on Monday.

READ MORE: Charles Lu: The man behind Luckin and China’s fastest IPOs

Why it matters: The deal would mean state-backed BAIC is taking over the China’s biggest car rental company in which Luckin Coffee chairman Charles Lu is the controlling shareholder.

Details: Ucar, a Shenzhen-listed auto service group controlled by Charles Lu, on May 31 reached a non-binding agreement with BAIC to buy up to 21.26% of Car Inc, according to a regulatory filing on Monday. Ucar is currently the largest shareholder in Car Inc, with a 21.26% stake.

  • Meanwhile, Car Inc said Amber Gem Holdings, a major shareholder who owns 10.11%, has agreed to terminate its stock acquisition plan with Ucar.
  • Amber Gem Holdings, a subsidiary of private equity fund Warburg Pincus, on April 16 made an agreement with Ucar to buy a total of 17.11% shares of Car Inc in two separate transactions. Warburg has been a backer of Car Inc since 2012.
  • Ucar currently owns 21.26% of the company as the biggest shareholder after transferring 4.65% shares to Amber Gem Holdings in the first tranche on April 16, according to a company filing.
  • If the deal is completed between BAIC and Ucar, BAIC could become the biggest shareholder of Car Inc as Ucar is basically exiting its investment.
  • Car Inc on Monday warned that Ucar and BAIC are still under negotiation.

What’s in a Ucar? Charles Lu formed Car Inc, a car rental company in Beijing in 2007

  • It later grew into the country’s biggest car rental chain with a fleet of 27,000 cars in 2010 and went public in Hong Kong in 2014.
  • Lu expanded his reach in Chinese mobility market with the establishment of Ucar, a ride-hailing startup in 2015.
  • Ucar was later restructured into an auto service group that includes car rental, auto sales, ride-hailing, and auto financial services.
  • Ucar was listed in Shenzhen in July 2016, and raised their stake in Car In from 12.12% to 29.36% in Car Inc with a market value of $326 million two years later.

Context: BAIC, one of Daimler’s major manufacturing partner in China, on April 13 announced “a comprehensive strategic partnership” with Ucar in car procurement, online auto sales, and car financial services.



Source link

What do you think?

Written by Aakash Malu

Comments

Leave a Reply

Your email address will not be published. Required fields are marked *

Loading…

0

Comments

0 comments

Meet the 20 top-funded fintech companies in Southeast Asia

Modes of closing a business