BYD plans share sale to grow

• Source: Shanghai Daily
• [08:22 July 17 2009]
• Comments

By Joyce Pan 

Chinese battery and electric car maker BYD Co said yesterday it plans to sell shares on China's mainland to fund its auto development and rechargeable-battery business.

BYD, partly owned by Warren Buffett's Berkshire Hathaway, plans to sell as many as 100 million A shares in Shenzhen, where the company is based, according to a statement filed to Hong Kong's stock exchange.

Proceeds will be used for the production of lithium ion batteries and solar energy batteries, auto development as well as expansion of its auto accessories and auto parts business. The rest will be used to replenish working capital, it said.

''The issuing of A shares will establish a new financing platform for the company. This will enable the company to enhance the development of its operations and to further improve its competitiveness,'' the biggest maker of rechargeable batteries in China said in the statement.

The listing in Shenzhen is subject to the approval of the securities regulator and its shareholders.

The company proposed to be listed on the mainland at the beginning of last year. But the plan was thwarted by the unsatisfactory performance of the local markets, which tumbled about 70 percent last year. However, the local markets have jumped nearly 60 percent so far.

BYD's sales more than doubled to 176,814 units in the first half from a year earlier. Wang Chuanfu, president of BYD, said earlier the firm aims to more than double car sales this year to 400,000.

The firm is also said to be seeking to buy a bus maker for at least 2 billion yuan (US$426 million) to increase output of alternative-fuel vehicles.

BYD gained 1.77 percent to HK$37.45 (US$4.83) in Hong Kong yesterday. The Hang Seng Index gained 0.57 percent.