Geely’s electric vehicle unit, Polestar, aims to raise around $ 900 million: sources

HONG KONG / BEIJING: Polestar, the electric vehicle unit of Chinese automaker Geely, is in advanced talks with investors to raise between $ 800 million and $ 900 million in its first external fundraiser, said people familiar with the affair.

Polestar’s first effort to raise funds outside of its parent company comes as the global auto industry continues to invest in electric technologies after electric vehicle makers from Tesla Inc to Nio Inc reported sustained sales growth.

The Sweden-based company is in final financing talks with Chinese investors, including Beijing E-Town International Investment & Development, according to sources familiar with the matter. One of the sources said the investment would put Polestar’s valuation at more than $ 5 billion.

The financing will help Polestar expand production and its line, the sources said. They declined to be named as the talks are private and they cautioned that the details are subject to change.

Polestar and Geely declined to comment. Beijing E-Town could not immediately be reached for comment.

Polestar manufactures high-performance hybrid cars in the western Chinese city of Chengdu and a sedan model at its Taizhou plant in the east. It also plans to start production of the Precept, a larger, greener sedan that will be on display at this year’s China Auto Show.

Reuters reported on Monday that Geely’s new electric vehicle factory in the western city of Chongqing will produce cars under the premium Polestar brand.

Hangzhou-based Geely is China’s best-known automaker in the world. It owns Volvo Cars and Lotus, almost half of Proton and 9.7% of Daimler AG. Hong Kong-listed Geely Automobile Holdings Ltd is planning a float in Shanghai.

(Reporting by Julie Zhu and Yilei Sun; Editing by Brenda Goh and Sam Holmes)