Apollo Future Mobility, a Hong Kong-listed company, announced on January 12 that it would acquire a subsidiary of Chinese automaker WM Motor for $2.02 billion. After this move, WM Motor will hold 31.1 billion of Apollo’s shares, accounting for 68.26% overall. This is a strong indication of WM Motor’s plan to carry out a public listing through a reverse takeover.
According to a report by Cailian Press, the follow-up process is mainly for Apollo to do its best to carry out due diligence. Considering that WM Motor submitted its A1 prospectus on May 31, 2022 and replied to several rounds of questions from the Hong Kong Stock Exchange (HKEx), the due diligence is expected to be completed within two to three months. Optimistically, WM Motor has a great chance of completing a listing in the second quarter of this year.
WM Motor recently received three rounds of funding, including HK$250 million ($32.0 million) from a well-known commercial bank, 500 million yuan ($74.0 million) from Amer International Group, a Fortune 500 company, and HK$1.5 billion ($192.0 million) from Agile Group.
Amer International Group is the largest copper mining enterprise in China. Cooperation with Amer means that both parties will make strategic progress in the integration of industrial chains. In addition, their collaborative project is expected to land in Chengdu, Sichuan Province. Agile Group was the largest investor of WM Motor in the round-D financing, and it is currently the firm’s largest shareholder apart from the management team.
According to people close to WM Motor, it is expected to complete equity financing totaling a minimum of $500 million on the listing date.
Apollo is engaged in batteries, 3D printing, design, and other businesses, while WM Motor’s advantages include production qualification, production capacity, intelligent platform, channels, brands and so on.
Apollo has not built any production base in China so far, and it has not launched any EV. With this strategic merger with WM Motor, it will deepen the intelligent pure electric vehicle market through WM Motor’s two fully qualified manufacturing bases, an annual production capacity of 250,000 units and more than 100,000 intelligent vehicles delivered to buyers.
After the strategic merger, WM Motor will improve its product matrix to launch Apollo sports car priced at $2 million and smart EVs priced at 600,000 yuan to 800,000 yuan.
Freeman Shen, the founder and CEO of WM Motor, once commented, “The new energy vehicle track is a long-term battle. To make a metaphor, it is like playing football. It is not known who wins or loses. What I want to say is that our team has a great advantage, that is, we have rich experience in fuel-based vehicles.” In order to survive, at the end of November, 2022, WM Motor took the initiative to optimize its organizational structure, including through layoffs and salary reductions.