July 17, 2018 / 4:56 AM / in 3 months

China's CATL to get $420 million upfront from BMW-Brilliance battery deal

SHANGHAI (Reuters) - China’s Contemporary Amperex Technology Ltd (300750.SZ) said on Tuesday it will receive a 2.8 billion yuan (£317 million) prepayment from a long-term contract to supply batteries to BMW Brilliance, a joint venture between Germany’s BMW (BMWG.DE) and Brilliance China Automotive Holdings (1114.HK). As part of the deal, BMW-Brilliance will buy 815 million yuan worth of battery related products, China’s biggest lithium battery maker said.

The joint venture will have the right to participate in CATL’s future fundraising plans, it added. CATL floated on the Shenzhen stock exchange last month with the aim of using the proceeds to fund its 24 gigawatt-hour (GWh) capacity expansion.

Last week, CATL announced that it would build its first production site in Europe in Germany, while BMW said it plans to source 4 billion euros ($4.7 billion) of battery cells from CATL over the next few years.

Reporting by Brenda Goh; Editing by Vyas Mohan

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