(Yicai) Nov. 30 -- Guangzhou Industrial Investment Holding Group, a state-owned enterprise, will adjust its method of acquiring a controlling stake in Farasis Energy Gan Zhou to better ensure the interest of the founders of the world’s leading soft-pack battery maker.

Farasis Energy's founders and people acting in concert have penned an agreement with the SOE controlled by the Guangzhou government to introduce the new controlling shareholder through private placement, the Jiangxi province-based company announced yesterday. GIIHG will acquire a number of newly issued shares that make 12 percent of the battery firm's total equity after the transaction.

The company did not make an estimation on how big GIIHG's investment will be nor the resulting total shareholding of Farasis Energy, adding to previous purchases. It just said that after the transaction, GIIHG will become the controlling shareholder of the target company. 

The new deal will replace an agreement penned in July. The earlier agreement stipulated that a subsidiary of GIIHG would pay CNY1.7 billion (USD239 million) in cash to acquire 5 percent of Farasis Energy from its original controlling shareholder, which should make GIIHG's total holding to increase to 18.6 percent, enough to become the new actual controller.

Farasis was established by battery scientists Dr. Wang of Canada and Dr. Keith D. Kepler of the United States in Silicon Valley, California, in 2002. It entered the Chinese market in 2009 by establishing the local subsidiary Farasis Energy Gan Zhou which was controlled by the two scientists before the deal. 

Despite being a pioneer in soft-pack lithium batteries which tend to be safer than hard batteries, Farasis Energy is still making a loss, which is part of its reason for introducing new investors. In the first three quarters of this year, Farasis Energy reported a net loss of CNY1.6 billion on revenue of CNY11.2 billion (USD1.6 billion), up 30 percent from a year ago, according to its latest earnings report.

Editor: Emmi Laine