HONG KONG (Reuters) - Chinese electric vehicle (EV) maker CHJ Automotive is seeking to raise $300 million to $500 million in its latest funding round, two people with direct knowledge of the matter said, joining its peers in tapping more investors to finance growth.
CHJ, founded by entrepreneur Li Xiang, sees itself valued at least $2.5 billion ahead of the new funding round and has hired Goldman Sachs to advise on the fundraising, they said. The bank declined to comment.
The firm, which plans to close the fundraising by June, also aims to go public overseas next year, said another person with knowledge of the matter.
The proceeds will be mainly used to finance mass production of its first EV, Leading Ideal One, and research and development, said the person.
A CHJ spokesman did not respond to calls or messages requesting comment. The sources declined to be named as the information is confidential.
CHJ, like several other EV companies, is hungry for cash as Beijing last month said it would cut the subsidies it has historically offered to new energy vehicles (NEVs), amid criticism that some firms have become too reliant on the funds.
Reuters reported last month EV startup Leap Motor, advised by Deutsche Bank, was seeking a private fundraising of 2.5 billion yuan ($371 million).
Earlier in March, WM Motor announced it closed its Series C funding round of 3 billion yuan.
In January, Reuters reported that Byton was seeking to raise at least $500 million to finance its growth.
CHJ founder Li Xiang, however, warned earlier this month at a conference that the fundraising environment was challenging as investors have become more cautious on the industry, Chinese business publication Caixin reported.
Beijing-based CHJ has previously raised around 6 billion yuan from investors, according to local media reports. Its main backers include venture capital firm Matrix Partners China, state-owned Shougang Fund and conglomerate Yintai Group.
The four-year-old company obtained an auto manufacturing license last year and plans to start mass production of Leading Ideal One in its wholly-owned plant in the eastern city of Changzhou in Jiangsu province in July, one of the people said.
It aims to roll out Leading Ideal One in the fourth quarter of this year, according to its website. The sport utility vehicle (SUV) is priced at 328,000 yuan apiece post-subsidies, which puts it in the middle to high-end category.
The company plans to open five retail centers in a few cities in May and eight more in the third quarter.
Reporting by Kane Wu and Julie Zhu; Additional reporting by Yilei Sun; Editing by Sonali Paul