On March 8, Sunwoda announced a plan to issue no more than 599 million shares to a maximum of 35 specific investors. With this private placement, Sunwoda aims to raise up to CNY 4.8 billion that will be used to fund the followings: (1) the development of a project for manufacturing and testing SiPs; (2) the development of a project for manufacturing high-performance Li-ion cylindrical batteries for consumer electronics; (3) the supplementary working capital.

Sunwoda plans to invest a total of CNY 2.203 billion in the development of the project for manufacturing and testing SiPs. The upcoming private placement is expected to allocate CNY 2.031 billion to the SiP project. As for the project for manufacturing cylindrical batteries, Sunwoda plans to invest a total of CNY 1.987 billion. The upcoming private placement is expected to allocate CNY 1.358 billion to the cylindrical battery project. Turning to the supplementary working capital, Sunwoda intends to add CNY 1.411 billion through the upcoming private placement.

A subsidiary of Sunwoda is responsible for the development of the cylindrical battery project that comprises a production line and other supporting facilities. The project is expected to take three years to complete and is set to have an annual production capacity of 310 million pieces.

In its announcement, Sunwoda stated that the cylindrical battery project will add new production capacity and allow the company to extend further into the upstream of the electronics supply chain. Furthermore, the company will expand its line-up for batteries used in consumer electronics to include high-performance cylindrical battery cells, pouch battery cells, and battery packs. With more production capacity, Sunwoda will have more in-house supply of batteries used in consumer electronics and thereby achieve a higher profitability.

Sunwoda already carried out multiple rounds of fundraising from 2018 to 2022, obtaining a total of more than CNY 11.6 billion in the period. According to publicly available information, Sunwoda’s last round of fundraising took place four months ago on November 14, 2022. For that round, the company issued GDRs at the SWX Swiss Stock Exchange and received USD 440 million (or around CNY 3.12 billion).

Sunwoda’s Upcoming Private Placement (Unit: CNY 10,000)

This article is a translation of a Chinese article posted by Wendy at TrendForce. It contains information that is either sourced from other news outlets or accessible in the public domain. Some Chinese names are transcribed into English using Hanyu Pinyin.