Geely's Lotus said to weigh raising $1B for EV shift

Zhejiang Geely Holding Group is considering raising about $1 billion to help expand Lotus Cars into the electric vehicles market in China, according to people familiar with the matter.

Geely is working with advisers to sound out potential investor interest in a funding round that could value Lotus’s EV operations at about $5 billion, the people said, asking not to be identified because the matter is private.

Separately from the fundraising, the Chinese company is also weighing an initial public offering of Lotus Cars, or just the British carmaker's EV business, as soon as next year, the people said.

A listing could value the entire business, including its combustion-driven sports and racing cars, at more than $15 billion, the people said.

Chinese billionaire Li Shufu’s Geely, which also controls Sweden-based Volvo Cars, purchased a stake in Group Lotus in 2017. It owns 51 percent of the company, including both Lotus Cars and consultancy Lotus Engineering, while Malaysia's Etika Automotive owns the remainder, according to a press release.

Under Geely, Lotus in 2019 launched its all-electric Evija hypercar, a 1,972-horsepower coupe that costs about $2 million.

Considerations are ongoing and details including size and timing could change, the people said. A Geely representative declined to comment. Representatives for Lotus did not immediately comment when contacted by Bloomberg News.

Geely is seeking to expand into electric vehicles amid a booming market in countries including China. Polestar, the electric-car maker controlled by Volvo Cars and Geely, is exploring options for going public as soon as this year, Bloomberg News has reported.

Investor mania over EV-related stocks has pushed the share prices of players including Nio and Xpeng to stratospheric levels. That intense interest has also spawned a wave of EV upstarts raising billions and racing to list via special-purpose acquisition companies. More than $180 billion has been raised globally through SPAC IPOs in the past 12 months, Bloomberg-compiled data show.