The acquisition is expected to boost the technological competitiveness of Xiaomi’s smart electric vehicle business
Xiaomi said that it will acquire Deepmotion Tech, an autonomous driving technology start-up, for nearly $77.4m, in a move to foray into the electric vehicles market.
The announcement was made by the Chinese electronics company following the release of its financial results for the second quarter of 2021.
Deepmotion Tech is engaged in offering full software stack solutions, which include perception, localisation, planning, and control for advanced driver-assistance system (ADAS) and automated driving applications.
According to Xiaomi’s directors, Deepmotion Tech’s technological and research and development (R&D) capabilities in offering full software stack solutions can boost the technological competitiveness of the company’s smart electric vehicle business.
Xiaomi president Wang Xiang said that the acquisition is intended to help the company in developing Level 4 self-driving technology, which enables full autonomous driving.
Xiang said: “Through this acquisition, we hope to shorten the time to market for our product. We want to speed up our autonomous driving R&D.”
Under an ordinary share purchase agreement signed with relevant parties, Xiaomi has conditionally agreed to acquire more than 125 million shares of Deepmotion Tech, representing 71.16% of the entire issued share capital. The consideration for this is $62.47m.
Xiaomi revealed that it had entered into a preferred share purchase agreement earlier this month to acquire over 50.8 million shares, representing 28.84% of the entire issued share capital of the company. The total consideration of the preferred share purchase agreement is around $14.9m.
Meanwhile, Xiaomi said that its net profit for Q2 2021 increased year-over-year (YoY) by 87.4% to CNY6.3bn ($970m). The company’s total revenue for Q2 2021 was CNY87.8bn ($13.54bn), which marks an increase of 64% YoY.