Beijing (ZXZC)- China’s major automaker JAC Motors announced that it had completed a private offering with RMB2 billion raised.

Volkswagen (Anhui); photo credit: Volkswagen

The announcement specifies that Anhui Jianghuai Automobile Group Corp.,Ltd. (JAC Group)  has issued 290,697,674 shares to Anhui Jianghuai Automobile Group Holdings Limited (JAC Holdings), priced at RMB6.88 per share, raising a total of RMB1,999,999,997.12, resulting in a net amount of RMB1,979,304,688.30 after other deductions.

Upon registration of the new shares, JAC Holdings’ stake in JAC Group increased from 17.15% to 28.18%, further reinforcing its control over the company.

JAC Group said that the private offering also benefits the company’s total assets and helps reduce its liabilities. The company’s business structure will not experience drastic changes but further optimization. The company’s independence and administrative office will remain the same.

Notably, the increment plan is believed to be a significant measure from Volkswagen to reinforce its control over Volkswagen (Anhui), its joint venture with JAC Group .

Currently, Volkswagen China owns 50% of JAC Holdings’ stake. With the growth of JAC Holdings‘ stake in JAC Motors, Volkswagen China’s stake in the subsidiary will also grow. Moreover, Volkswagen will hold more stake in Volkswagen (Anhui).

With Volkswagen’s previous plan of delivering 1.5 million new energy vehicles each year by 2025, its new energy vehicle dedicated joint venture Volkswagen (Anhui), will play an important role.