Samsung unit buys BYD stake for US$449m

TOKYO: BYD Co said a unit of Samsung Electronics Co bought a US$449 million (RM1.82 billion) stake in the Chinese car 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 per cent.

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 three million units a year by 2025, after surpassing the United States last year to become the global market leader.

For Samsung, the foray into the auto industry is also a way to help make up for declining growth in hardware businesses such as televisions and smartphones. Bloomberg