Chinese state-owned automaker SAIC Motor Corp plans to invest up to 2.7 billion yuan ($382.2 million) in the country’s solid-state lithium-ion battery maker QingTao (Kunshan) Energy Development.
The proposed investment, subject to the approval of QingTao’s existing shareholders, will boost SAIC Motor’s stake in the firm to about 15.29% from the current 4.2%, the Shanghai-based group disclosed in a Friday filing with the Shanghai stock exchange.
Previously, SAIC Group invested a total of 283.5 million yuan ($40.1 million) in QingTao across two transactions in 2020 and 2022.
“The solid-state battery technology is a key component of our new energy strategy. The increased investment in QingTao will help deepen our strengths in the solid-state battery sector, stay ahead of the game amid a new round of technological advancements, and increase the competitiveness of our new energy offerings,” said SAIC Motor in the filing.
“Furthermore, leveraging the complementary advantage between QingTao and SAIC Motor in tech expertise and supply chain resources, we will build a joint venture to step up our strategic cooperation and accelerate the mass adoption of new-generation solid-state batteries in new energy vehicles,” SAIC Motor said.
SAIC Motor looks to purchase the additional stake in QingTao through two affiliated investment vehicles. It offers to buy almost 63.4 million shares in the firm at a price of 42.6 yuan (about $6) apiece, shows the filing. The transactions are set to be completed on or before June 30.
Established in 2016 by Tsinghua University professor Nan Cewen, QingTao has raised multiple funding rounds from Bank of China’s asset management subsidiary and domestic automakers BAIC Motor and Guangzhou Automobile Group (GAC). China-focused venture capital (VC) firm FreesFund, an early backer of QingTao, now holds a combined 18.08% stake in the firm through two subsidiaries.
Despite its upward fundraising trajectory, QingTao has yet to become profitable. The firm booked a net loss of just over 256 million yuan ($36.2 million) in 2022, against its revenue of 549.3 million yuan ($77.8 million). Its unaudited financial results from Q1 this year showed revenue of 55.8 million yuan ($7.9 million) and a net loss of 54.5 million yuan ($7.7 million).
In July 2022, QingTao and SAIC Motor set up a joint lab to focus on the development, mass production, and adoption of solid-state lithium-ion batteries capable of supporting an average driving distance of over 1,000 km (621.4 miles) per charge. The lab also works on the 15-minute (4C) fast-charging technology of lithium-ion batteries and researches lithium-ion batteries with enhanced safety, extended life span, and higher efficiency.