Asia Tech Wire (July 26) -- Jiangsu Lopal Tech Co. (603906.SH), a supplier to CATL, the world's biggest EV battery maker, is considering raising about $200 million for its Indonesian subsidiary, according to Bloomberg.

Thursday's report, citing people familiar with the matter, said Lopal is working with an adviser to gauge interest from potential investors.

The move is to bolster production of battery materials for electric vehicles in Indonesia, the report said.

Lopal is a Chinese supplier of lithium iron phosphate (LFP) cathode materials, and its customers include major domestic and foreign battery producers such as CATL (300750.SZ), Sunwoda (300207.SZ), EVE Energy (300014.SZ) and LG Energy Solution (LGES, 373220.KS).

In February 2022, the company set up an Indonesian subsidiary, PT.LBM Energi Baru Indonesia, through its affiliate Changzhou Liyuan New Energy Technology Co. to begin preparations for a local plant.

The Indonesian project, with a planned investment of $290 million, plans a capacity of 120,000 tons of LFP cathode materials, including 30,000 tons in the first phase and 90,000 tons in the second phase.

Lopal expects to start production of the first phase of the plant in the third quarter of this year, and plans to build the second phase by the end of the year.

The company also expects to start the construction of a production base in South Korea in 2025, with a total capacity of 120,000 tons for the two phases.

In February, Lopal signed a long-term agreement with LGES worth more than 7 billion yuan. Under the agreement, Liyuan will supply 160,000 tons of LFP cathode material products to LGES from 2024 to 2028.