Last weekend, Hillhouse announced the clearance of NIO Inc. shares, as NIO Inc. 's long-term firm investor, this operation really surprised the market:From the proponent to the stranger, has Hillhouse seen the decline thoroughly?

However, after inquiring about the information, the editor found that Hillhouse did not completely clear NIO Inc. because it still holds convertible bonds of the latter, and today there are even media reports that Geely will buy a stake in NIO Inc.. Although it is difficult in the short term, the competitiveness of NIO Inc. 's excellent products / services is recognized by the market and continues to attract capital from all sides.

Hillhouse has not completely cleared its stock, NIO Inc.?

Hillhouse has long been optimistic about the new energy car track and has been NIO Inc. 's main investor, including leading NIO Inc. 's $100m in round A financing in 2015 and continuing to follow in round C.

NIO Inc. landed on Nasdaq on September 12, 2018, with an offering price of $6.25 per share and a total market capitalization of $6.4 billion. As can be seen from the prospectus, Hillhouse holds 65.36 million shares listed by NIO Inc., accounting for 7.5%, and diluted to 6.4% after listing, so the market value of the post-IPO position is about $410 million.

Entering 2019, NIO Inc. ushered in the lifting of the ban on March 13. Hillhouse reduced its stake in NIO Inc. to 21.31 million shares in the first quarter, then increased its stake in 2019Q2 to 41.93 million shares, and 2019Q3 reduced its value to 13.36 million shares until 2019Q4 was completely cleared, according to Bloomberg data.

Overall, Hillhouse Capital is in 2019In 2000, he cleared NIO Inc. 's stock, but at the same time subscribed for the convertible bonds issued by NIO Inc..On January 31, 2019, NIO Inc. issued US $650 million convertible bonds with a coupon of 3.5% and a conversion premium of more than 27.5%. Among them, Tencent subscribed for US $30 million and Hillhouse subscribed for US $10 million. In this regard, the editor guessedHillhouse's strategy may be:Reduce your holdings of NIO Inc. shares and use part of the proceeds to buy NIO Inc. convertible bonds, so that you can invest precious cash in the company's current difficult operations and support product research and development and sales services in a timely manner. In the future, it will be converted back to the stock at a certain appropriate price (the company will not get a penny if NIO Inc. 's share price is bought to take off in the secondary market).By doing so, the remaining funds from the reduction can be allocated to the new target, killing two birds with one stone.

In February this year, NIO Inc. announced that he had just completed two more convertible bond financing of US $100m each, totaling US $200m, invested by two Asian investment funds, both of which were "unrelated parties". Assuming that the above logic is true, then will there be a Hillhouse figure in it? please forgive the editor's brain.

Happy to see Geely take a stake

With regard to Geely's plan to buy a stake in NIO Inc., I am happy to see it succeed.

One is the king of its own brand, through the acquisition of Volvo, after years of integration in research and development, manufacturing, procurement and other aspects of great progress, to achieve rapid growth. The other is the leader of the new force of car building, which has established technological advantages in electrification and intelligence. if it is successfully invested, the two sides are likely to carry out R & D and production cooperation, and are expected to achieve huge complementary and synergistic effects.

In terms of amount, $300 million is irrelevant to the current powerful Geely. From 2017 to 2019, Geely had annual revenue of 100 billion yuan and net profit of 10 billion yuan, with cash on its 2019H1 account of 14 billion yuan. In the first half of 2019, the asset-liability ratio of the company was 48.7%, and the financial situation was good.

And according to the current market capitalization of US $3.9 billion, Geely may become the third largest shareholder of the company with an investment of US $300 million. at present, the first and second are the company's CEO Li Bin 14.4% and the investment agency Baillie Gifford 13.13%. Today, Geely executives said that they will not comment on the rumors of buying shares, and so is NIO Inc., which is very ambiguous. Based on Li Shufu's magnificent spirit of "buying" in the past, the editor hopes that this rumor will come true.