Opening new tabs is modern Amperex Technology (300750. SZ), said to be the biggest battery maker worldwide. At present, this Chinese company, worth $333 billion, seems to have accidentally assumed the role of a champion for minority shareholders. Still, it might have to confirm this recent stance.
Carmaker Geely Auto (0175.HK), opens new tab, is aiming to privatize its electric vehicle unit, Zeekr (ZK.N), opens new tab, at a valuation of $6.5 billion, barely a year after its stock was released in New York. This seemed like a given result considering that the group and its founder, Li Shufu, control about 80% of the shares.
According to Reuters, citing three sources familiar with the situation, however, the early investors in Zeekr. It includes CATL, Intel Capital, and Boyu Capital, a Chinese asset management company, which have voiced their opposition to the undervalued offer in a letter to Zeekr’s board.
Their concerns are warranted. Geely’s 14% premium over the closing stock price of the prior day is rather little. According to Dealogic, take-private transactions in the United States carried an average premium of 39% over the previous year. Although Geely’s significant existing ownership calls for some discount, as Visible Alpha notes, the implied valuation at 0.2 times the predicted sales for 2026 is markedly below the 0.9 average for a collection of five comparable companies.
Although the special committee appointed by the corporation to evaluate the offer may still be inclined to heed CATL’s input, which is also a major supplier, Zeekr shares are presently trading in line with the cash and stock offer price.
Robin Zeng’s company took part in several fundraising campaigns for Zeekr, including a $750 million round in 2023 that valued the company at $13 billion and a $500 million deal with Boyu and Intel in 2021. CATL has five years of cooperation with Zeekr, the first brand to use its 1000-kilometre Qilin batteries. It opens a new tab and also works with other brands Li owns, including Volvo Cars.
Although CATL’s influence as a provider might be limited, it has several other reasons to assume a fresh role as an active shareholder as well.