Automaker ZAP (Zero Air Pollution) announced Thursday it has bought a majority stake in its China-based partner Zhejiang Jonway Automobile, and intends to buy out the rest of the company in the coming year.
The boards of directors for both companies approved a merger agreement on July 2 in which ZAP agreed to acquire 51 percent of Jonway Auto for $29.03 million in cash and the exclusive distribution rights for Jonway cars in exchange for 31.5 million shares of ZAP common stock at $1 per share. The deal also gives ZAP the right to buy out the remaining 49 percent of Zhejiang Jonway Automobile by March 30, 2011, according to ZAP.
"ZAP intends to acquire the remaining 49 percent of Jonway Automobile following completion of the first phase and following final regulatory approval," the company said in a statement.
ZAP specializes in light-duty all-electric vehicles for industrial fleets, and counts among its clients the United States Postal Service, Google, and the University of San Francisco.
Zhejiang Jonway Automobile, a subsidiary of the Jonway Group, and ZAP had announced a joint partnership in April to develop a line of all-electric taxis for the Chinese market. ZAP also announced at the time that it had hired H. David Jones as its new chief operating officer. Since then the company has had a series of high-profile rollouts of new projects and products.
In late April at the Beijing Auto Show, ZAP unveiled the all-electric taxi based on the existing Jonway A-380 five-door SUV. The ZAP version has a top speed of 70 mph, and a range of about 100 miles per charge.
In May, the ZAP announced it had developed a new lithium-ion battery for use in its cars, and entered the Zap Alias sports car to compete in the Progressive Automotive X-Prize.
Then in June ZAP showcased several vehicles modified for light-duty military use at the Renewable Energy Rodeo and Symposium, at the U.S. Army Research, Development and Engineering Command's Tank and Automotive Center at Fort Bliss. It included the Zaptruck XL which has a payload of up to 1,900 pounds.