The struggle for control of Jiangsu Saleen Automotive Technology had escalated, putting the joint venture in which CNY10 billion (USD1.4 billion) has been invested at risk of becoming yet another failed Chinese electric carmaker, The Paper reported.
Chairman Wang Xiaoling has filed an arbitration in Hong Kong over the breach of a joint venture agreement by an investment firm under the government of Rugao in China’s Jiangsu province, the report said yesterday.
In a statement, Wang said Nantong Jiahe Technology Investment Development, which owns about 34 percent of Saleen, has refused to communicate with four overseas-funded firms controlled by him, which jointly own the remaining 66 percent, since May 29. That includes refusal to attend the Saleen’s shareholder meeting.
According to a resolution adopted by the company at an extraordinary shareholders’ meeting on July 4, Nantong Jiahe was required to pay off the CNY300 million (USD42.8 million) it owes to the company within five working days, in accordance with the terms of the JV agreement. The arrears were to be used to first pay wages and social security and tax insurance claims of all current and former employees.
On July 2, the administration committee of the Jiangsu Rugao Economic and Technological Development Zone announced that an audit and review by Nantong Jiahe, an investment institution it controls, found that Wang was suspected of providing false documents and exploiting his position to embezzle a large amount of money from the JV. Nantong Jiahe has reported the case to the police, who have accepted the complaint, the committee added.
JV's Origin
Rugao, a prefecture-level city in Jiangsu, announced in 2009 that it had partnered with US-based Saleen Automotive and other firms to invest in a Saleen vehicle project in the eastern Chinese province. The JV’s registered capital was CNY9.6 billion. According to media reports, the project’s total investment in China amounted to CNY17.8 billion.
Steve Saleen founded the eponymous Saleen marque and is the designer of the high-performance sports car model Saleen S7.
Saleen held a costly grand promotional event in Beijing last July, at which British action movie star Jason Statham and Chinese actor-singer Kris Wu performed on stage and the US carmaker said it would launch four Saleen models in China: fuel sports car S7, fuel speedster S1, electric sports utility vehicle Mac and an all-electric microcar called MaiMai.
But only MaiMai, which can run at up to 100 kilometers an hour, has been put into the Chinese market so far, and it received only nine down payments for the model at the MaiMai flagship store on Tmall, Alibaba’s online store, in the first month.
Jiangsu Saleen has as yet only released Saleen MaiMai, an A00-class all-electric vehicle, in China. As the JV’s only model available for mass production, MaiMai, whose pre-orders were launched online last November, received just nine orders before it was removed from Tmall store’s shelf two months later.
The JV held a high-profile event in Shanghai in 2017 to announce the official arrival of the American modified car brand and also brought a super sport car Saleen S1. Wang said then that the JV’s production lines will also cover mid-to-high-end sedans and SUVs besides super sports vehicles after the domestic plant is completed.
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