Samsung Buys $449 Million Stake in Buffett-Backed Carmaker BYD

[Ye Tian (James)]

 

 

By Craig Trudell

     (Bloomberg) -- BYD Co., the electric-car maker backed by Warren Buffett’s Berkshire Hathaway Inc., said a unit of Samsung Electronics Co. bought a 3 billion-yuan ($449 million) stake in the Chinese auto company.

     Shanghai Samsung Semiconductor bought 52.3 million BYD shares at 57.4 yuan apiece in a private placement that raised

14.5 billion yuan in total from six investors, according to a statement to Shenzhen stock exchange. The fundraising will dilute billionaire Chairman Wang Chuanfu’s stake by about 1.9 percentage points to 18.8 percent.

     Samsung pursued a stake in BYD after its affiliate was among foreign battery makers left off a list of suppliers approved by China, where sales of electric vehicles are surging and the government has sped up construction of charging points.

The world’s largest maker of phones and memory chips said last week investing in BYD would bolster Samsung’s semiconductor business for cars.

     BYD will use the proceeds from the placement to fund an expansion in battery production and research and development into new-energy vehicles, it said in the statement. China’s government wants sales of electric vehicles to exceed 3 million units a year by 2025, after surpassing the U.S. last year to become the global market leader.

     BYD’s Shenzhen-traded shares fell 0.9 percent to 61.94 yuan at the close on Thursday.

 

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Subramaniam Sharma