RT Advanced Materials, a Chinese producer of lithium-ion battery materials, has closed over 5 billion yuan (nearly $740 million) in a Series D round of financing from investors including Shang Qi Capital.
Shang Qi Capital, the private equity (PE) arm of Chinese state-owned automaker SAIC Motor, led the Series D round, in its latest effort to step up dealmaking in China’s new-generation automotive sector, the investor announced on Wednesday.
The new deal came only a few weeks after the lead investor held the first closing of a new RMB-denominated PE fund at 800 million yuan ($118.2 million). With a targeted fund size of 1 billion yuan ($147.8 million), Shang Qi Capital plans to focus its firepower on areas from new-generation vehicle energy, hydrogen fuel batteries, advanced driver assistance systems (ADAS) and autonomous driving to automotive electronics and materials, as well as auto chips.
Founded in 2016, RT specialises in the R&D, production and commercialisation of anode materials for lithium-ion batteries, as well as the recycling and reuse of lithium-iron phosphate batteries, a type of lithium-ion batteries known for its longer life span, light weight and better discharge. Its products are widely applied in various consumer electronics and new energy vehicles (NEVs), the utility sector, and energy storage systems that support 5G communication.
“Our cooperation with RT will help SAIC Motor continue to lead the development of China’s power battery technologies and ensure battery supplies to the parent firm,” said Shang Qi Capital.
“The cost advantage of lithium-iron phosphate batteries will be more appreciated by the market amid the expansion of their use cases, including new energy generation and storage, as well as household energy storage,” said the lead investor.
The new funding, which is expected to help RT further expand its production capacity, attracted capital support from several large-scale automotive groups, emerging car brands, battery manufacturers and China’s state-owned industry funds, including SDIC Unity Capital. SDIC Unity Capital was a lead investor in RT’s Series C round.
RT used the proceeds from its Series C round to build a production line capable of delivering 100,000 tonnes (100 million kilograms) of anode materials for lithium-iron phosphate batteries. The startup is expanding its manufacturing facilities, with a target of hitting a production and recycling capacity of over 300,000 tonne per year. It estimates to generate over 10 billion yuan ($1.5 billion) in revenue this year.
Xiaomi Zhizao Equity Investment Fund, which is led by smartphone maker Xiaomi Corp’s Chief Executive Lei Jun; state-owned automaker Dongfeng Motor’s subsidiary Dongfeng Asset Management; and RT Chairman He Zhonglin, all participated in the round, the startup revealed in a WeChat post in May.
According to the earlier post, RT initially targeted to raise 5.5 billion yuan ($813.1 million) for the Series D round, as it planned to complete an initial public offering (IPO) within two years.