New management company to acquire bankrupt Neta Auto

Hozon New Energy Automobile Company, the bankrupt parent firm of Chinese battery electric vehicle start-up Neta Auto, is reportedly set to be acquired by management company Zhejiang Taiyi Shanglian Enterprise Management Partnership. The acquisition, following a third creditors meeting, sees Taiyi Shanglian investing CNY 3 billion (US$ 447 million) in Hozon, acquiring a 70.6% stake.

The deal includes a CNY 3 billion restructuring fund, with CNY 1.17 billion earmarked to address legacy debt, including paying creditors, covering bankruptcy expenses and other restructuring costs. The remaining CNY 1.83 billion will be injected into Hozon for working capital to restart production and sales operations. Manufacturing equipment for Neta L and Neta X SUV models will be retained, while equipment for Neta S and GT sedans can be sold separately.

Hozon's recovery plan includes a three-stage process: initial production start-up with a first-year sales target of 10,000 vehicles, scaling operations to 300,000 vehicles annually, and developing new global intelligent electric vehicle models to reach a CNY 40 billion annual output value.