Geely’s EV brand Zeekr raises $500 million in first external funding

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Led by Chief Executive Andy An, who is also Geely’s president, Zeekr said investors would jointly hold a 5.6% stake in the company, valuing it around $9 billion. Chief financial officer Yuan Jing told reporters that Zeekr does not currently have a clear plan for its initial public offering.

The company makes the Zeekr 001 model in the eastern city of Ningbo and is expected to start delivering them later this year. It aims to sell 650,000 vehicles a year by 2025.

Investors also included Cathay Fortune Corporation, which invests in mining companies, and private-equity firm Boyu Capital that additionally signed long-term investment partnerships with Zeekr, the carmaker said in a statement.

Zeekr, which targets young and trendy customers, is jointly owned by Geely Automobile and its parent Zhejiang Geely Holding Group.

The companies are expected to contribute expertise in intelligent connectivity, batteries, young consumer markets and raw materials, it said.

Car companies globally are working with more tech companies, battery makers and mining firms to develop future products and secure supply of components amid a shift towards electric vehicles (EV).

Zhejiang Geely Holding Group, the owner of Volvo Cars and a 9.7% stake in Daimler AG (DE:DAIGn), and Geely Automobile launched the Zeekr in March this year to compete with EV companies including Tesla (NASDAQ:TSLA) Inc and Nio (NYSE:NIO) Inc. They jointly invested 2 billion yuan ($308.4 million) into the brand earlier.

Zeekr, like other global automakers, is trying to secure more chips that is used in its vehicles to ramp up production. Its executive said in June that it has sold out of deliveries for this year.

It also has other electric vehicle brands including mass-market Geometry, which saw sales growing in the past months, and premium Polestar.

($1 = 6.4847 Chinese yuan renminbi)