(By Balaseshan) Kandi Technolgies Corp. (NASDAQ: KNDI), a manufacturer of all-terrain vehicles, said its unit has formed a joint venture with Geely Automobile Holdings Ltd. for production and sale of electronic vehicles in China.
Zhejiang Kandi Vehicles Co. Ltd. has signed a cooperation framework agreement with Shanghai Maple Guorun Automobile Co. Ltd., a 99% owned unit of Geely Automobile Holdings Ltd., to establish a joint venture company, named Zhejiang Kandi Electric Vehicles Investment Co, Ltd.
The JV company will be owned 50% by Shanghai Maple and 50% by Kandi Vehicles. The registered capital of the JV company will be 1 billion Yuan Renminbi and with 50% to be contributed by each party.
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Upon the establishment, the JV company will buy certain assets from Kandi and Geely Auto in order for the JV company to process the necessary properties, assets and technologies to conduct the electronic vehicles business.
To enable the proposed enterprise to take place, both Kandi and Geely Auto will establish new wholly-owned subsidiaries and inject certain assets into these companies. The JV company will then acquire all the equity interests in each of these companies.
The board of directors of the JV Company will consist of four directors, of which two will be nominated by Kandi Vehicles and two will be nominated by Shanghai Maple.
Shufu Li, Chairman of Geely Auto, will be appointed to be the first Chairman of the JV company and Xiaoming Hu, Chairman & CEO of Kandi, will be appointed to be first General Manager. Each appointment is for a term of three years.
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KNDI is trading up 0.27% at $4.02 on Monday. The stock has been trading between $2.33 and $5.13 for the past 52 weeks.