(Yicai Global) Feb. 7 -- China’s battery giant Contemporary Amperex Technology will construct a plant with cleanroom product developer TA&A Ultra Clean Technology in eastern China to expand their battery material output.

The pair will build a factory in lithium-rich Yichun to produce 100,000 tons of lithium carbonate per year, the Suzhou-based apparel maker said in a statement recently. The plant will be CATL's second in the same city in Jiangxi province.

Yichun is known for its huge reserves of about 2.5 million tons of lithium oxide. Ningde-based CATL signed an agreement with the local government last September to pour CNY13.5 billion (USD2.1 billion) into a new battery production base in the city. 

The two above-mentioned firms will establish a CNY1 billion (USD158 million) joint venture to construct the production base. CATL will have 90 percent of the equity and TA&A will have the remainder.

Within 12 months since the establishment, the factory should be able to produce 50,000 tons of lithium carbonate. By the end of 2023, it should reach full capacity. When it comes to orders, CATL's local battery factory is prioritized.

TA&A didn't disclose the scale of project investment. However, an earlier project by CATL’s partner, Yongxing Special Materials Technology, shows that an investment of CNY2.5 billion was required to build a lithium carbonate factory in Yichun. CATL has 70 percent of the equity.

TA&A’s stock price [SHE: 300390] closed up 3 percent at CNY67.77 (USD10.70). 

CATL’s share price [SHE: 300750] fell 2.2 percent to CNY579.44 (USD91.50).

Editor: Emmi Laine, Xiao Yi