Shanghai (ZXZC)- On September 17, Chery Holding and Chery Automobile Co.,Ltd (Chery Automobile) issued pre-announcements for the increase of company's registered capital and shares on Changjiang Equity Exchange.

According to respective announcements, Chery Holding and Chery Automobile plan to concurrently bring in new investors by means of enlarging the shares by increasing capital. The investors should subscribe the registered capital of RMB 1,962,151,751 and RMB 1,012,931,633 newly added by Chery Holding and Chery Automobile respectively.

Huatai Asset Management and Wuhu Ruichuang Investment Co., Ltd, two of the Chery Holding's shareholders will transfer their equity of 15.6782% and 3.8799% in Chery Holding to new investors to ensure a smooth process.

Once the capital and shares increase is completed, the registered capital for Chery Holding will grow to RMB 6,240,558,251. The existing three shareholders will hold 68.5581% of stake in total and the new investors will occupy 31.4419% stake in Chery Holding. Meanwhile, the register capital of Chery Automobile will be increased to RMB 5,469,831,633 after the process completed.

The capital and shares increase plan has been agreed by both companies’ board of directors and shareholders' meeting on September 12 and approved by Wuhu municipal government.  

Moreover, the announcements point out that the money raised will be used to repay Chery Automobile's debts and develop and operate Chery Holding's existing and new businesses.

Reportedly, this move is also related to the “Chery Strategy 2025”. Based on the strategy, Chery aims to make layouts in a range of areas, such as innovative technologies, new energy, intelligent connectivity and premium international markets, which will cost a huge amount of capital.