Dongfeng Motor Group is set to make a strategic move by exiting the Hong Kong stock market, with its high-end electric vehicle (EV) unit Voyah gearing up for an independent listing as part of a much-anticipated restructuring plan.
In a recent filing with the Hong Kong Stock Exchange, Dongfeng announced its decision to have Voyah listed on the Hong Kong stock market through an introductory listing, while simultaneously completing its privatization and delisting process. This development comes as Dongfeng has been grappling with a prolonged period of undervaluation, with its stock market capitalization consistently lagging behind its net asset value.
As part of the restructuring, Dongfeng H-share shareholders will be entitled to receive HK$6.68 ($0.85) in cash along with 0.3552608 Voyah H shares for each share they hold. The total transaction value is estimated to be around HK$10.85 per share, a significant premium compared to Dongfeng’s share price of HK$5.97 at the time of suspension on August 8.
An introductory listing involves the listing of existing securities without the issuance of new shares or financing at the time of listing. This approach allows existing shareholders’ securities to be traded on the exchange without the need for fresh capital infusion.
Voyah, a premium EV brand launched by Dongfeng in late 2020, has been making a mark in the competitive EV market, particularly with the introduction of its flagship model, the Voyah Free, in China in June 2021. The decision for Dongfeng to delist is motivated by its undervaluation in recent years, which has led to its stock market value consistently falling below its net asset value.
Meanwhile, Voyah has been experiencing robust growth momentum and is considered one of Dongfeng’s most valuable and high-growth assets. The brand reported a significant year-on-year increase in vehicle deliveries, with 68,263 units sold in the first seven months of this year alone.
The move to list Voyah independently and exit the Hong Kong stock market reflects Dongfeng’s strategic realignment to unlock the full potential of its premium EV brand and streamline its financing channels. This restructuring initiative is expected to position both Dongfeng and Voyah for sustained growth and success in the evolving EV landscape.
