(Yicai Global) Dec. 9 -- Chinese battery giant CATL is preparing to become a stakeholder in a new facility built by Guangdong Jiayuan Technology that will quintuple the latter’s annual output of copper foil for electric car batteries.

The new factory will have an annual capacity of 100,000 tons of copper foil, Jiayuan said. The company’s current yearly output is 21,000 tons. The Meizhou, southern Guangdong province-based firm supplies 50 percent of the world’s 4.5 micron extremely-fine copper foil used in lithium-ion batteries and CATL is a major client.

A joint venture with a registered capital of CNY2 billion (USD315 milion) will be set up to run the factory, it said. Jiayuan will hold a 80 percent stake and Ningde, southeastern Fujian province-based CATL the remainder. Exact investment amounts were not given.

The project will be built in two phases. The first phase, with an annual capacity of 50,000 tons, will start operating within three years after the JV is established. The schedule for the final stage of construction has yet to be determined.

The pair might also build another copper foil plant of a similar size, depending on the success of the first one and how market conditions develop, Jiayuan said.

Jiayuan’s share price [SHA:688388] was trading up 2.79 percent at CNY159.60 (USD25) as of 2:12 p.m. China time, while CATL [SHE:300750] was trading down 2.24 percent at CNY624.70 (USD98).

Editor: Kim Taylor