Abu Dhabi-based investment vehicle CYVN Holdings increased its investment in China’s smart EV manufacturer Nio securing a 20.1% stake in the company, Kallanish reports.

Nio said Monday it sold 294 million new Class A ordinary shares at $7.50 each, raising $2.2 billion in investment from CYVN. The transaction is expected to close in the last week of the month, enabling the UAE company to pick two directors for Nio’s board of directors.

The nominations will stand as long as CYVN’s equity does not fall below 15%. With an ownership higher than 5% but lower than 15%, CYVN will have one director on Nio’s board.

Vowing to jointly pursue strategic and technology collaborations in “international markets,” the companies described the new strategic equity investment as an endorsement of Nio’s “unique positioning and competitiveness in the global smart EV industry.”

“With the enhanced balance sheet, Nio is well prepared to sharpen brand positioning, bolster sales and service capabilities, and make long-term investment in core technologies to navigate the intensifying competitive landscape, while continually improving execution efficiency and system capabilities,” notes Nio’s chief executive William Bin Li. “We are confident that Nio will further solidify its leading position in the transformation of the automotive industry.”

The Chinese firm saw its net loss in Q3 2023 increase 10.8% on-year, though it was smaller quarter-on-quarter. It has recently announced the purchase of manufacturing equipment and assets from its manufacturing contractor JAC, in a move towards independent vehicle production. At the time, Li said the acquisition would lower manufacturing costs by 10%.

CYVN, meanwhile, deploys capital in smart and advanced mobility solutions to create a “smart mobility platform.” In July, it closed a $738.5 million investment into Nio, which in addition to share buying from Tencent, secured the investor a 7% share in the carmaker. The latest investment was done via affiliate CYVN Investments RSC Ltd.