China's BYD has confirmed Samsung Electronics had completed the acquisition of a 1.92% stake in the electric vehicle manufacturer for CNY3bn (US$450m).

The Chinese subsidiary of the South Korean electronics giant, Shanghai Samsung Semiconductor, purchased 52.26m BYD shares at CNY57.4 per share in a private placement.

BYD said it would use the funds to increase production capacity of lithium-ion batteries and to expand its new-energy vehicle R&D operations.

Samsung said previously the investment was designed to strengthen ties between the two companies – particularly in the development and production of electric vehicle components and advanced electronic systems.

Samsung wants to play a part in the rapid growth in the Chinese electric vehicle market and BYD is a key player in this segment. 

Sales of new-energy vehicles in China more than quadrupled to 331,100 units last year including a five-fold increase in electric vehicles to 247,000 units and a tripling of plug-in hybrid vehicle sales to 84,000 units.

Earlier report: Samsung Electronics seeks stake in China electric carmaker BYD