Geely has faced resistance from investors, according to Geely's $2.2 billion campaign for electric vehicle division Zeekr.

Early investors including Contemporary Ampere Technology (CATL), Intel Capital and Boyu Capital expressed concern that the offer did not reflect Zeekr's fair value.

Investors participating in the Zeekr initial fundraising expressed their dissatisfaction through two letters to the company's board of directors and a special committee.

They believe that the price of privatization is too low, and the first letter says it values ​​Zeekr at just $6.5 billion, which is much lower than its peers like Li Auto and Xpeng.

Geely, known for buying international brands such as Volvo and Proton, announced that it intends to fully integrate Zeekr into Geely Automobile on May 7.

This move is surprising, especially since Zeekr went public in the United States a year ago.

The bid also raised speculation about the future of other Geely units such as Caocao, and the possibility of U.S. listed units such as Polestar.

Geely Auto owns about two-thirds of Zeekr, which itself belongs to Geely Holding Holding Umbrella, hosted by Geely founder Eric Li.

A Geely spokesman said discussions with Zeekr’s special committee are underway, while Zeekr, Catl, Intel Capital, Boyu Capital and Cathay Fortune have not commented yet. Another investor, Billy, declined to comment.

According to Geely Auto's documents, the offer is a non-binding, binding agreement that depends on the execution determination and its terms and conditions.

Eric Li's strategy has shifted from aggressive acquisitions to simplifying operations and reducing costs amid fierce competition in the Chinese auto market.

Zeekr has become Geely's asset, with sales reaching 41,403 units in the first quarter, up 25% year-on-year, surpassing Byd's premium brand Denza.

Investors urge any privatization agreement should be approved by most "independent minority" shareholders.

Five investors are part of Zeekr's first external fundraising round in 2021, which is worth $9 billion and holds a 6% stake.

Later, a round of valuation in 2023 was $13 billion, but its public valuation fell to $5.5 billion.

Another investor, Y2 Capital, reportedly also sent a letter to respond to these concerns.

Geely's offer accounts for Zeekr's $25.66 per U.S. deposit share, a 24% premium to the average share price before the announcement, which is lower than the average private transaction premium in the U.S. and 40% since 2023.