Shanghai (ZXZC)- The Nasdaq-listed Chinese car dealer Kaixin Auto Holdings ("Kaixin") announced on Sept. 26 that it has inked a binding acquisition term sheet with Wuxi Morning Star Technology Co., Ltd. ("Morning Star"), the manufacturer and operator of the POCCO electric vehicles (EVs). Under the term sheet, Kaixin intends to acquire 100% equity interest in Morning Star through new share issuance.

Earlier this year, Morning Star purchased 100% equity in Henan Yujie Time Limited, a Chinese EV manufacturer owning the small-sized EV brand POCCO. The POCCO EV business under Morning Star produces two all-electric mini passenger vehicle models, the MeiMei and the DuoDuo, whose total sales volume has exceeded 40,000 units since the production started in June 2021.

POCCO DuoDuo; photo credit: POCCO

According to Kaixin's statement, Morning Star possesses core technologies in EV manufacturing, covering battery, electric motor, electric control system, intelligent connectivity, autonomous driving, battery integration/quick swap, battery range extension, and fuel cells. Its founder and president, Gu Lei, served as senior technology expert with Ford Motors, dean of Cherry Automobile Research Institute, and VP of BAIC Motor before it founded Kaixin.

Both Kaixin and Morning Star agreed to fast-track the M&A (merger and acquisition) transaction. They expect to sign the definitive SPA (sales and purchase agreement) by the end of October and complete the transaction by the end of this year.

Notably, Kaixin announced in August the commencement of operation at its new energy commercial vehicle headquarters in Suzhou city, Anhui province.

Kaixin Auto Holdings is one of the primary dealership networks in the premium used car segment and new car sales in China. It is amid the transition from a nationwide dealerships network to one of players in China's EV market.