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Get 150 million dollars! Smart holds hands with domestic lithium mining giant

2024-04-13 Update From: AutoBeta autobeta NAV: AutoBeta > News >


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On September 13th, Tianqi Lithium Industry announced that it had signed a "share subscription Agreement" with smart Brand Global. According to the agreement, Tianqi Lithium Industry will invest 150 million US dollars in smart, and the cooperation between the two sides is not only at the level of financial investment. Through this cooperation, the two sides will make full use of the information advantages of the upstream and downstream of the new energy industry chain to give full play to the synergy of the industry.


For this cooperation, Tianqi Lithium founder Jiang Weiping said: "investing in the smart brand is the first time Tianqi Lithium Industry has established contact with the downstream automobile end of the industrial chain, which will further deepen our understanding of the new energy industry chain." In the future, Tianqi Lithium Industry will join hands with strategic partners to promote the transformation of lithium battery vehicle technology to low carbon, environmental protection and green, and make new contributions to the progress of human civilization and sustainable development. " Smart brand CEO Tong Xiangbei said to the cooperation between the two sides: the cooperation between the two sides has not only reached cooperation at the level of financial financing, but will also make full use of the information advantages of both sides in the upper and lower reaches of the industrial chain and give full play to industrial synergy to enable the steady development of business. It will also further broaden smart's brand vision and help to strengthen the competitiveness of the smart brand in the global market.


Relevant data show that Tianqi Lithium Industry is a new energy material enterprise with lithium as the core and the largest supplier of lithium new energy core materials in China. Mainly engaged in the R & D, production and sales of lithium series products, the leading products are battery-grade lithium carbonate, industrial-grade lithium carbonate, battery-grade anhydrous lithium chloride, industrial-grade anhydrous lithium chloride, battery-grade lithium hydroxide, industrial-grade lithium hydroxide and lithium dihydrogen phosphate, high-purity lithium carbonate and lithium metal. The business scope includes manufacturing and selling industrial lithium carbonate, medicinal lithium carbonate and its lithium series products, and other chemical products.

According to the latest financial data of Tianqi Lithium Industry in the first quarter of this year, Tianqi Lithium Industry achieved revenue of 11.449 billion yuan in the first quarter, an increase of 117.8 percent over the same period last year, and its net profit reached 4.875 billion yuan, an increase of 46.49 percent compared with 3.328 billion yuan in the same period. In addition, the gross profit margin of Tianqi lithium industry in the first quarter was as high as 89.8%, up 4.52 percentage points from the same period last year.


In fact, Tianqi Lithium Industry's investment in the smart brand was decided as early as July 13. On July 13, the smart brand announced that it would start a round of financing, with plans to raise $250 million to $300 million. Officials say the purpose of the financing is to accelerate the global development of brands. At the same time, it is pointed out that this round of investment is led by Tianqi Lithium Industry, whose planned investment amount is as high as 150 million US dollars.

The smart brand is a small car brand launched by Mercedes-Benz in 1998. In 2019, Geely Holdings acquired a 50 per cent stake in smart. At the beginning of 2020, Mercedes-Benz and Geely jointly established Zhi Motor Automobile Co., Ltd., each holding 50% of the shares, operating and developing the smart brand. On June 6, 2022, Geely and Mercedes-Benz jointly developed the first model, smart Spirit # 1, with a price range of 18.16-226600 yuan. The car is based on the SEA vast architecture, the appearance and interior design are from Mercedes-Benz, Geely provides SEA vast pure electric architecture and overall engineering research and development. In June this year, smart Spirit # 3 went on sale, and the new car launched four equipped models with a price range of 20.99 to 289900 yuan.


Backed by the two giants of Benz and Geely, their development is also valued by the industry. However, the performance of the smart brand in the Chinese market is not ideal. Relevant data show that in 2022, the operating income of Smart Motor is 1.856 billion yuan, the net profit is about 1.459 billion yuan, and the total debt is 7.07 billion yuan. In the first half of this year, the operating income was 5.211 billion yuan, the net profit was 661 million yuan, and the total debt was 13.36 billion yuan. In terms of sales, the domestic sales of smart in August were 3201; from January to August this year, the cumulative domestic sales of smart were 31033. Compared with the sales volume of the new car-building forces in China, there is still a certain gap. In terms of sales volume, smart brand CEO Tong Xiangbei once said: smart does not intend to participate in the price war, and the most important goal at present is to establish the brand image of "the world's leading new luxury intelligent pure electric car".


For smart, the establishment of the brand image of "the world's leading new luxury intelligent pure electric vehicle" needs a huge amount of money to support. At this stage, smart still does not make a profit, so it needs more funds to support. Although there are two backers of Geely and Mercedes-Benz, the business of both shareholders is relatively large, and now they have entered a period of deep transformation, and the funds that can be used to support smart are limited. In this context, smart needs funds to seek more sources of funding. After all, financing can enable it to quickly obtain more funds, expand the development scale of enterprises, and enhance their competitiveness. Cooperation with Tianqi Lithium Industry can not only obtain financial support, but also further ensure the supply chain security of smart.

For Tianqi lithium industry, the price of mineral resources fluctuates periodically and is easily affected by the price of lithium materials. By binding vehicle enterprises such as smart, you can increase your own anti-risk ability and stabilize your orders through car companies. Of course, this kind of cooperation has been very popular in recent years, and many new energy vehicle industry chain companies have entered the vehicle industry through investment, shareholding and other ways. For example, the Ningde era has invested in Naxi Automobile, Polar Krypton and Avita since 2021. Ganfeng lithium industry also held hands in GAC Ean in 2022 and continued to increase capital to invest in Lantu Automobile this year.

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