Arab Press

بالشعب و للشعب
Friday, Aug 22, 2025

Li Ka-shing files bankruptcy petition against electric carmaker chief

Li Ka-shing files bankruptcy petition against electric carmaker chief

Hong Kong billionaire Li Ka-shing, known for his prescient and successful investments in industries ranging from property to infrastructure, has hit a speed bump as far as his foray into the electric-vehicle sector is concerned. Li’s investment in Hong Kong-listed FDG Electric Vehicles has shrunk by more than 40 per cent in value. Stock of We Solutions, another firm Li has invested in, drops 1.1 per cent on Monday.

Hong Kong billionaire Li Ka-shing, known for his prescient and successful investments in industries ranging from property to infrastructure, has hit a speed bump as far as his foray into the electric-vehicle sector is concerned.

His four-year-old investment in FDG Electric Vehicles, a Hong Kong-listed Chinese maker of new-energy vans and buses, has shrunk by 42 per cent in value. Over the weekend, he filed a bankruptcy petition against Cao Zhong, FDG’s chairman, through his foundation in Canada.

Shares of FDG, which is based in the eastern Chinese city of Hangzhou, tumbled 29 per cent to 26.5 HK cents on Monday, extending its losses to 73 per cent this year. FDG was unable to assess the impact of Li’s petition on the company as the petition was still at a preliminary stage, it said in an exchange filing with the Hong Kong bourse.

Li now holds a 2.1 per cent stake in FDG, as its fourth-largest shareholder, while Cao has a 4.1 per cent stake and is FDG’s third-largest shareholder. Li bought 743 million shares of FDG for 46 HK cents apiece in 2015, valuing the deal at HK$341.8 million (US$43.6 million).

FDG has been unprofitable over the past few years and its business has worsened recently amid headwinds facing the industry, such as an economic slowdown in China and the government’s scaling back of subsidies on new-energy vehicle purchases. It posted a net loss of HK$1.99 billion for the financial year ending in March, after a loss of HK$2.23 billion for the previous year.


 Superman Li's FDG gamble

The company acknowledged its financial difficulties in its annual report and said it had defaulted on a couple of bank loan repayments, and that it was negotiating with debtors to convert debt into equity and had asked the government for help. One of its subsidiaries, Hangzhou Changjiang Automobile, had even stopped paying employees, the National Business Daily reported in July.

China’s electric-car market, the world’s biggest, is reeling from the partial withdrawal of government subsidies. Sales dropped 4.7 per cent and 16 per cent from a year earlier, in July and August, respectively, after an average 60 per cent cut in subsidies this year. Annual sales had increase at 51 per cent over the past two years.

Another of Li’s investments, in We Solutions, a Hong Kong-based maker of new-energy cars, has not fared well either, with its share price below levels Li bought at in May. Li invested in We Solutions at 51 HK cents a share through a unit of Agile Group Holdings. The stock declined 1.1 per cent to 46.5 HK cents on Monday.

Li is the richest businessman in Hong Kong, with a net fortune of US$28.1 billion, according to Bloomberg.

There is mounting concern Beijing has created an electric-vehicle bubble that may be about to burst. Total sales fell for the first time in July after the government scaled back its subsidies. Deliveries dropped again last month, raising doubts that one of the final pillars of strength in China’s broader car market, which has fallen in 14 out of the past 15 months, is wavering.

Shanghai-based Nio is poised to report on Tuesday that it lost another 2.6 billion yuan (US$369 million) during the second quarter, according to the average of two analyst estimates. That would bring accumulated losses at the company to about US$5.7 billion since William Li Bin founded the carmaker in 2014.

Newsletter

Related Articles

Arab Press
0:00
0:00
Close
Dogfights in the Skies: Airbus on Track to Overtake Boeing and Claim Aviation Supremacy
Tim Cook Promises an AI Revolution at Apple: "One of the Most Significant Technologies of Our Generation"
Are AI Data Centres the Infrastructure of the Future or the Next Crisis?
Miles Worth Billions: How Airlines Generate Huge Profits
Zelenskyy Returns to White House Flanked by European Allies as Trump Pressures Land-Swap Deal with Putin
Beijing is moving into gold and other assets, diversifying away from the dollar
Trump Backs Putin’s Land-for-Peace Proposal Amid Kyiv’s Rejection
Zelenskyy to Visit Washington after Trump–Putin Summit Yields No Agreement
Iranian Protection Offers Chinese Vehicle Shipments a Cost Advantage over Japanese and Korean Makers
United States Sells Luxury Yacht Amadea, Valued at Approximately $325 Million, in First Sale of a Seized Russian Yacht Since the Invasion of Ukraine
Saudi Arabia accelerates renewables to curb domestic oil use
Cristiano Ronaldo and Georgina Rodríguez announce engagement
Asia-Pacific dominates world’s busiest flight routes, with South Korea’s Jeju–Seoul corridor leading global rankings
Private Welsh island with 19th-century fort listed for sale at over £3 million
Sam Altman challenges Elon Musk with plans for Neuralink rival
Australia to Recognize the State of Palestine at UN Assembly
The Collapse of the Programmer Dream: AI Experts Now the Real High-Earners
Armenia and Azerbaijan to Sign US-Brokered Framework Agreement for Nakhchivan Corridor
British Labour Government Utilizes Counter-Terrorism Tools for Social Media Monitoring Against Legitimate Critics
WhatsApp Deletes 6.8 Million Scam Accounts Amid Rising Global Fraud
Texas Residents Face Water Restrictions While AI Data Centers Consume Millions of Gallons
India Rejects U.S. Tariff Threat, Defends Russian Oil Purchases
United States Establishes Strategic Bitcoin Reserve and Digital Asset Stockpile
Thousands of Private ChatGPT Conversations Accidentally Indexed by Google
China Tightens Mineral Controls, Curtailing Critical Inputs for Western Defence Contractors
JPMorgan and Coinbase Unveil Partnership to Let Chase Cardholders Buy Crypto Directly
British Tourist Dies Following Hair Transplant in Turkey, Police Investigate
WhatsApp Users Targeted in New Scam Involving Account Takeovers
Trump Deploys Nuclear Submarines After Threats from Former Russian President Medvedev
Germany’s Economic Breakdown and the Return of Militarization: From Industrial Collapse to a New Offensive Strategy
Germany Enters Fiscal Crisis as Cabinet Approves €174 Billion in New Debt
IMF Upgrades Global Growth Forecast as Weaker Dollar Supports Outlook
Politics is a good business: Barack Obama’s Reported Net Worth Growth, 1990–2025
UN's Top Court Declares Environmental Protection a Legal Obligation Under International Law
"Crazy Thing": OpenAI's Sam Altman Warns Of AI Voice Fraud Crisis In Banking
Japanese Prime Minister Vows to Stay After Coalition Loses Upper House Majority
President Trump Diagnosed with Chronic Venous Insufficiency After Leg Swelling
Man Dies After Being Pulled Into MRI Machine Due to Metal Chain in New York Clinic
FIFA Pressured to Rethink World Cup Calendar Due to Climate Change
Iranian President Reportedly Injured During Israeli Strike on Secret Facility
Kurdistan Workers Party Takes Symbolic Step Towards Peace in Northern Iraq
BRICS Expands Membership with Indonesia and Ten New Partner Countries
Elon Musk Founds a Party Following a Poll on X: "You Wanted It – You Got It!"
AI Raises Alarms Over Long-Term Job Security
Russia Formally Recognizes Taliban Government in Afghanistan
Saudi Arabia Maintains Ties with Iran Despite Israel Conflict
Mediators Edge Closer to Israel-Hamas Ceasefire Agreement
Germany Seeks Taliban Deal to Deport Afghan Migrants
Emirates Airline Expands Market Share with New $20 Million Campaign
Robots Compete in Football Tournament in China Amid Injuries
×