HONG KONG • Hong Kong billionaire Li Ka-shing (picture) agreed to buy an indirect stake in a Japanese maker of electric cars, expanding his investments in an area that’s set to benefit from China’s push to phase out petrol and diesel vehicles.

Li and two other investors are buying a stake in O Luxe Holdings Ltd, according to two company filings made in Hong Kong. O Luxe is a distributor of watches and jewellery that’s in the middle of acquiring Japan’s GLM Co, a maker of electric sports cars with plans to license its technology to manufacturers including those in China.

Sales of electric vehicles (EVs) have surged in the world’s largest car market on the back of generous state support, prompting global manufacturers to boost their lineups of non-emission autos. The demand has attracted investments from a flock of startups as well as companies from outside the industry, including a failed attempt by China’s biggest air-conditioner maker.

Li’s investment in O Luxe, and by extension GLM, gets him a place in the higher-end of the EV market, a segment that Chinese startups like NIO and Beijing CH-Auto Technology Co are targeting and Tesla Inc now dominates with its imported Model S.

The race to sell more EVs looks set to heat up further after China said on Sept 9 that it would set a deadline for automakers to end sales of vehicles powered by fossil fuels. The announcement follows the government’s earmarking in 2010 of new-energy vehicles as a strategic emerging industry meriting state support.

News of Li’s investment, via Ocean Dynasty Investments Ltd, helped send O Luxe shares surging as much as 6.1% to HK$1.74 (RM0.94), the highest intraday price since June 2013.

This isn’t the first time the Hong Kong tycoon, whose global business empire spans ports to retail to telecommunications, has invested in EVs. In 2015, he bought a stake in FDG Electric Vehicles Ltd, a Chinese electric-van and bus maker. — Bloomberg