(Yicai) Nov. 1 -- Shares of Leapmotor Technology, China's sixth-largest electric vehicle startup last year that just got funded by the European owner of brands Peugeot and Maserati, recovered after founders of the Nio rival pledged not to sell their shares for 10 years.

Leapmotor [HKG: 9863] closed up 2.8 percent at HKD27.85 (USD3.56). Yesterday the stock price slumped by almost 16 percent after a market rumor claimed founder Zhu Jiangming would sell his shares and leave the company.

Zhu, chairman and chief executive officer, and his spouse Liu Yunzhen, as well as persons acting in concert Fu Liquan and his spouse Chen Ailing, promised not to transfer or reduce their shares in the company in any way in the next decade, the Hangzhou-based firm announced today.

Since it was set up in 2015 Leapmotor has developed a number of new energy vehicle models, including the C01 sedan, C11 crossover sport utility vehicle, and T03 city car, for the Chinese market, where it competes with domestic rivals such as Nio and Xpeng Motors. Leapmotor ranked sixth among Chinese NEV startups last year after deliveries jumped more than 150 percent to almost 111,170 cars.

The cashout rumors began circulating online after Amsterdam-based carmaker Stellantis announced on Oct. 26 that it would invest EUR1.5 billion (USD1.6 billion) to acquire about 20 percent of Leapmotor to advance its asset-light strategy by investing in local companies in China and exporting China-made vehicles abroad.

Leapmotor is the second joint venture between Zhu and Fu after they co-founded Dahua Technology, a video surveillance firm. The shareholder group represented by Zhu and Fu holds about 27.5 percent of Leapmotor’s shares, according to public information.

The deal will take place in two parts. Stellantis will buy newly issued 194 million shares, or 14.5 percent of Leapmotor’s enlarged share capital. It will also purchase all of Dahua's 90 million shares in the startup.

After the transaction is completed, the shareholding ratio of Leapmotor’s founder group will drop to 23.5 percent, still remaining the actual controller of the company. Stellantis will become the largest external shareholder, receiving two board seats.

Leapmotor's business has improved this year. Last month, it delivered a new high of over 18,200 cars, almost tripled from a year ago, according to the latest data. From July to September, net loss narrowed by 26 percent to CNY986 million (USD134.7 million) from a year earlier while revenue jumped by 32 percent to CNY5.7 billion (UD778.7 million).

Editors: Dou Shicong, Emmi Laine