Warren Buffett-Backed Electric Vehicle Maker Plans Battery Unit IPO





(Bloomberg) -- BYD Co., the electric-car maker backed by Warren Buffett, plans to list its battery business by 2022 to raise funds to expand as the global auto industry transitions away from the traditional combustion engine.

The listing will occur sometime by the end of 2022 and the company hasn't decided yet where the shares will be trading, Chairman Wang Chuanfu said in an interview with Bloomberg News Wednesday at its headquarters in Shenzhen. BYD, which makes batteries for automobiles and mobile phones, is in the process of spinning off its vehicle-battery operations into a separate company before listing. It isn't clear yet whether the IPO will be for the car-battery business alone, or will also include other units.

Batteries are emerging as a key part of the electric-car revolution that's causing the biggest disruption to the auto industry in more than 100 years. Contemporary Amperex Technology Co., or CATL -- the world's biggest battery maker -- has more than tripled in value since raising more than $800 million in its Shenzhen IPO in June, as investor cash gravitates toward the industry. BYD and CATL are China's key makers of power packs for electric vehicles and are emerging as challengers to Tesla Inc. suppliers Panasonic Corp. and LG Chem Ltd.

Wang, the billionaire founder of BYD, estimated that the country would need to boost battery-manufacturing capacity by about ten-fold to 1000GwH a year by 2030 if China fully electrified transport.

The company, which has been self-sufficient in making batteries for its own vehicles, started discussions last year with other carmakers for contracts, Michael He, vice president of the battery business, said in an interview.

Buffett's Berkshire Hathaway Inc. is the largest shareholder in the Hong Kong-traded stock of BYD, with a 24.59 percent stake. Buffett made the bet two years before Tesla listed in New York.

BYD is working on a plan to build vehicle-battery factories in both Europe and the U.S. In Europe, the company is looking at possible locations in the U.K. and Germany, He said. The company is also talking to potential domestic and foreign investors for fundraising ahead of the IPO, He said without elaborating.

To contact Bloomberg News staff for this story: Matthew Campbell in Shenzhen at mcampbell39@bloomberg.net;Tian Ying in Shenzhen at ytian@bloomberg.net

To contact the editors responsible for this story: Anand Krishnamoorthy at anandk@bloomberg.net, Ville Heiskanen

For more articles like this, please visit us at bloomberg.com

©2018 Bloomberg L.P.

COMMENTS

More Related News

Trump Files Notice of Appeal to Ruling on His Financial Records
Trump Files Notice of Appeal to Ruling on His Financial Records

On Monday, U.S. District Judge Amit Mehta ruled that the House Oversight and Reform Committee has authority to examine Trump's personal and business records going back to 2011. The Mazars case is Trump v. Committee on Oversight and Reform, 19-cv-1136, U.S. District Court, District of Columbia (Washington).

Tesla Falls as Analyst Says Company Facing
Tesla Falls as Analyst Says Company Facing 'Code-Red Situation'

In a note Sunday, Wedbush analyst Dan Ives described the electric-car maker's predicament as a "code red situation" and cut his price target on the stock to $230 from $275. Ives slashed his target from $365 just last month. Tesla shares fell as much as 7.5% to $195.25 and were trading at $200.68 as

Tesla Falls as Analyst Says Its Profit Goal Is a
Tesla Falls as Analyst Says Its Profit Goal Is a 'Kilimanjaro-Like' Climb

In a note Sunday, Wedbush analyst Dan Ives described the electric-car maker's predicament as a "code-red situation" and cut his price target on the stock to $230 from $275. Ives slashed his target from $365 just last month. Tesla shares fell 3.8% in early trading in New York Monday, poised to reach

Ahead of Fox News Forum, Buttigieg Critical of Hosts and Trump
Ahead of Fox News Forum, Buttigieg Critical of Hosts and Trump

Buttigieg, the openly gay mayor of South Bend, Indiana, who's risen in polls since a CNN town hall in March gave him national exposure, said he agreed to appear because he wants to reach voters who might not otherwise hear his message. "I'm concerned that we're retreating into media bubbles," Buttigieg told reporters after an event Saturday in Dubuque, Iowa.

Iraq Says Exxon Evacuation of Staff Is `Unacceptable
Iraq Says Exxon Evacuation of Staff Is `Unacceptable'

"This withdrawal may send the wrong message about the situation in Iraq, and that's something we reject," Iraq's Oil Minister Thamir Ghadhban said in a statement on Saturday. The minister sent a letter to Exxon officials seeking clarification about the decision and asking that the workers return to

Leave a Comment

Your email address will not be published. Required fields are marked with *

Cancel reply

Comments

Top News: Economy

facebook
Hit "Like"
Don't miss any important news
Thanks, you don't need to show me this anymore.