China EV maker BYD gets support from Warren Buffet

China EV maker BYD gets support from Warren Buffet

The Chinese car and battery maker has got backing from one of the richest persons in the world Warren Buffet. Moreover, the Hong Kong stock exchange has also approved the proposed spin-off for its semiconductor unit situated in mainland China. 

The electric vehicle maker based in  Shenzhen is controlled by its co-founder Wang Chaunfu. According to the stock exchange filing, the approval for the plan that led to its listing was received on October 22 from the Hong Kong Bourse for its chipmaking unit. 

However, the company requires to meet several criteria and conditions before it implements planning. It requires seeking approval from CSRC (China Securities Regulatory Commission). 

The spinoff will allow investors to appraise strategies, returns, and risks of BYD’s semiconductor business. As per BYD, people should independently invest in the relevant business directly. 

It will provide a more equitable assessment of businesses. 

As a leading independent manufacturer, the BYD semiconductor will get helped by the plan. The maker of power electronic switching devices and automotive-grade IGBTs is getting financial assistance from channels to optimise corporate affairs and enhance brand awareness. 

BYD had drawn 48 per cent of its sales in the last six months from the sale of its mobile handset components and other products. Moreover, it earned 43 per cent from automobiles and related products—furthermore, 9 per cent from photovoltaic business and rechargeable batteries. 

The Berkshire Hathaway backed group announced for the maiden time to list its 72.3 per cent chip-making unit in May. 

It wanted to list it on ChiNext, which is a Nasdaq like tech board. It is operated by Shenzhen bourse and intends to raise USD 421 million. 

Notably, its IPO in Shenzhen was accepted in June, but for some reason, it was put on hold during August. Interestingly, the bourse had launched an investigation encircling the law firm advising the deal. 

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