Nio Secures US$235 Million In Interest Free Debentures

Chinese electric car maker Nio Inc (NYSE: NIO) has returned to the trough yet again to source convertible debt to keep its operation afloat. The company has secured US$235 million from “unaffiliated” Asia-based investment funds that will purchase the debentures on a private placement basis.

The funding follows an additional US$100 million that was sourced by the company back in January, prior to the company announcing that it had been severely impacted by the coronavirus. The company saw a sales decrease of 11.5% during the month, while February figures are yet to be released.

The debentures announced this morning by Nio are expected to close by March 11, 2020. The debt will be provided at an interest rate of 0%, similar to that of the previous debentures. The debentures mature March 5, 2021, and come with the option to convert to Class A common shares of Nio at a price of $3.50 per share after September 5, 2020.

Nio is a premium Chinese electric car manufacturer, which began selling cars in the Chinese market in June 2018. The firm currently has a number of vehicle models available for sale within the market, and has been deemed by many as being the “Tesla of China.”

Nio Inc last traded at $3.87 on the NYSE.


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