CDH has agreed to buy 1.3 billion ordinary shares of New Focus Auto at HK$0.30 per share for a total amount of US$48.7 million.
On top of that, CDH will buy zero coupon convertible bonds worth US$48.7 million. Upon full conversion, CDH will own a controlling 63.2% of New Focus Auto.
Being the single largest shareholder, CDH will have the right to nominate seven directors, including four CDH partners, to New Focus Auto’s board. CDH will also have the right to appoint a chief financial officer.
The completion of the investment is subject to various conditions such as the approval of New Focus Auto’s shareholders.
New Focus Auto plans to use the investment from CDH to improve its liquidity position and overall financial strength, implement its expansion strategies through acquisitions and opening of new stores.