Sunwoda Electric Vehicle Battery, an electric vehicle (EV) battery maker affiliated with the publicly-listed Sunwoda Electronic, is planning to raise 2.43 billion yuan ($385.1 million) from a consortium of investors including China’s major EV firms and traditional automakers.
The 19 investors have agreed to purchase about 19.5% shares in Sunwoda Electric Vehicle Battery for 2.43 billion yuan, giving the firm a valuation of almost 12.5 billion yuan ($2 billion), the parent firm disclosed in a recent filing with the Shenzhen stock exchange (SZSE).
The new investors include companies associated with Chinese EV firms Nio, Li Auto, and Xpeng, as well as investment platforms backed by the country’s traditional car manufacturers SAIC Motor, GAC Group, and Dongfeng Motor Corporation.
Jiangsu CHJ Automotive, an affiliate of the Nasdaq- and Hong Kong-listed Li Auto, subscribed to over 3.2% shares with a planned investment of 400 million yuan ($63.4 million) in the deal. It will become the fifth-largest shareholder of Sunwoda Electric Vehicle Battery.
The deal will “promote the healthy operations and sustainable development of our EV battery business” by providing the unit with operating capital, optimising its financial structure, reducing debt, and enhancing the firm’s resistance against risks, said the parent firm in the filing.
The affiliate will continue to be majority-owned by Sunwoda Electronic, but the stake held by the parent firm will reduce to 57.5% from 71.5% after the completion of the deal, according to the filing. CITIC Securities Investment, a subsidiary of Chinese brokerage firm CITIC Securities and its fourth-largest shareholder, will see its stake decrease to about 3.5% from 4.4%.
Sunwoda Electric Vehicle Battery was launched in 2014 as Chinese traditional battery firm Sunwoda Electronic’s march into the EV battery market 17 years after its inception. The EV battery unit adopts the lithium battery integration technology to the R&D and production of EV battery packs. It also offers its self-developed battery management system (BMS) and highly-automated solutions for battery cell sorting, module stacking, assembling, and packaging.
As it already sealed orders from automakers like Dongfeng Motor and SAIC-GM-Wuling Automobile, Sunwoda Electric Vehicle Battery has plans to invest about 20 billion yuan ($3.2 billion) in total for the construction of manufacturing facilities in Shandong province in eastern China. The manufacturing facilities are expected to produce 30GWh of EV batteries per year, according to a stock exchange filing in December 2021.
It booked over 1.5 billion yuan ($237.7 million) in revenue and a net loss of 253.7 million yuan ($40.2 million) in the first nine months of 2021.