BYD (HKG:1211, SHE:002594) denied rumors it will purchase Nio (SGX:NIO, HKG:986) and set up a joint venture, Yicai Global reported, citing BYD branding and public relations chief Li Yunfei.
Li called on netizens to stop spreading rumors and added the Shenzhen-based car company is asking its legal department to investigate after Nio reported the matter, Yicai said.
The rumor claimed both BYD and Nio would form a 51:49 joint venture to be called Bi Wei Lai Automotive, with BYD buying Nio for 16.5 billion yuan, the report said. Following the supposed joint venture, Nio will still operate independently, the report said.
The talks come as the auto industry in China is fostering consolidation to help cope with competition, according to Yicai.
Nio's Hong Kong shares plunged 6% during Tuesday's afternoon trading.
(Market Chatter news is derived from conversations with market professionals globally. This information is believed to be from reliable sources but may include rumor and speculation. Accuracy is not guaranteed.)
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