EHang (亿航智能, Nasdaq: EH), one of the largest domestic eVTOL and UAV technology companies, today announced that it has struck a deal to sell shares to a consortium of select buyers for US$23 million as part of a private placement.
The deal was led by Lee Soo-man, a South Korean music producer and founder of SM Entertaiment (041510.Kosdaq), followed by an undisclosed number of other investors.
EHang will use proceeds from the placement to supplement its working capital and meeting other general corporate purposes.
The goal is “enabling acceleration of strategic plans for technology advancement, business development and post-certification commercial operations,” said a company statement.
The investment is expected to further solidify EHang’s position as a leader in the global UAM industry.
Across the world, as regulators ease restrictions on low-altitude airspace, innovations such as eVTOL have sprung up to meet demands for alternative forms of urban mobility.
According to an exchange filing by EHang, the Guangzhou-based firm will receive a deposit of 80% of the aggregate purchase price from the investors within three business days.
The transaction is expected to be completed in the third quarter of 2023 and will be subject to regulatory review and customary closing conditions.
In addition to the private placement, EHang and Lee will also join hands to promote the development of urban air mobility solutions in the Asia Pacific region by leveraging both parties’ complementary strengths.
“I was impressed by Mr. Lee’s interest in and passion towards innovative technologies, future air mobility, and our autonomous aerial vehicles,” Hu Huazhi, founder, chairman and CEO of Ehang, stated.
“We are thrilled to have long-term strategic investors and partners, such as Mr. Lee, who share the same values and commitment in our journey.”
For his part, Lee, lead investor on the deal, also expressed optimism for the future tie-up. “I appreciate EHang’s unwavering dedication to enabling safe, autonomous and eco-friendly air mobility for the general public, as the first mover and a leading innovator in the emerging UAM industry with great potential,” Lee, a well-known patron of K-pop, said.
He added that he looks forward to the “convergence of cutting-edge transportation technologies and popular culture to create sustainable value.”