Chinese battery manufacturer Contemporary Amperex Technology (CATL) plans to raise CNY20bn (US$2.86bn) through a private placement to fund investment in new production facilities for automotive lithium batteries, according to a company filing dated 26 February.
According to the filing, CATL plans to invest the funds in the construction of five separate lithium battery projects with a combined production capacity of 52 gigawatt hours (GWh).
The private share issue is to be priced at no less than 80% of the average price the shares have traded at in the previous 20 days.
CATL is estimated to be the largest global manufacturer of electric vehicle batteries. In the filing, the company stated it delivered 32.5 GWh of batteries last year – up almost 39% on the previous year.
CATL has signed numerous supply agreements with domestic and global vehicle manufacturers over the last few years, the latest being a major deal to supply US electric vehicle manufacturer Tesla.
According to Reuters, Tesla was looking to source cobalt free, lithium iron phosphate batteries from CATL for cars produced at its newly built plant in Shanghai, to help keep costs down.
The Chinese ministry of industry and information technology wants new energy vehicles, currently mainly electric and plug in hybrid vehicles, to account for 25% of total passenger vehicle sales in the country by 2025 from less than 5% in 2019.