China’s largest power and fibre optic cable manufacturer, Hengtong Optic-Electric, listed on the Shanghai Stock Exchange, owns a wholly-owned subsidiary called Hengtong Submarine Power Cable, which recently raised $145.4 million in a strategic fundraising round at a pre-money valuation of $2.5 billion.
Four strategic investors were drawn to the round, according to a regulatory filing on March 30. These investors included the asset management division of Bank of China, the investment arm of China Construction Bank, Changshu Jingkai Guofa Fund, established by state-owned Changshu Guofa Venture, and Hainan Zhongying Equity Investment Fund.
Read also – Israeli-Based Biotech Company Nectin Therapeutics Secures $10 Million in Funding
According to the filing, the new money was a part of the round that attracted the $7 billion Guokai Manufacturing Transformation and Upgrading Fund, a state-owned fund with the goal of fostering the growth of the manufacturing industry. The fund had previously invested $141.4 million in December 2023.
The profits will assist with both the day-to-day operations of the business and the repayment of bank loans, bringing the firm’s post-money valuation to $2.6 billion.
Underwater communication cable development is the focus of Hengtong Optic-Electric’s Changshu-based submarine power cable unit. Many institutional and industrial investors are now interested in participating in the round. Nonetheless, the round’s overall investment profits won’t go over $423.5 million.
Read also – Egypt-based Fintech Swypex Secures a $4 Million In Seed Funding
The US-China competition has found a new front in the war submarine cables. According to Reuters in April 2023, HMN Technologies which is purportedly majority owned by Hengtong Optic-Electric was a part of a $500 million proposal to build an underwater fibre optic Internet cable network that could link Europe, Asia, and the Middle East.
About Hengtong Submarine
The Hengtong Group is primarily focused on the development and manufacturing of joint closures, underwater optical-fiber cables, underwater power cables, optical fibre composite submarine cables, and ocean engineering cables and accessories.
