SEOUL/WASHINGTON, Aug 28 (Reuters) - South Korea's

Samsung SDI said on Wednesday it has completed an

agreement with General Motors ( GM ) to build a joint electric

vehicle (EV) battery factory in the U.S. state of Indiana.

The two companies will invest about $3.5 billion to build a

battery cell manufacturing plant with an annual production

capacity of 27 gigawatt hours (GWh) initially, Samsung SDI said

in a statement.

Shares of Samsung SDI rose as much as 3.2% in morning trade,

versus benchmark KOSPI's 0.3% fall.

The plan was first announced in April 2023 when GM and

Samsung SDI said the joint venture would cost more than $3

billion, with planned production capacity of 30 GWh and

operations to begin in 2026.

The South Korean battery maker said Wednesday the joint

plant aims for mass production in 2027 and annual capacity is

expected to potentially rise to 36 GWh under expansion plans.

Kurt Kelty, GM vice president of battery cell and pack, said

he had joined Samsung SDI's CEO to finalize the battery joint

venture.

Kelty said the plant will have the "capability to expand up

to 36 GWh, building prismatic cells, which will be added to our

battery technology portfolio, helping us to continue to increase

performance and lower costs in the future."

Last year, GM said it expected the Indiana plant would have

production lines to build both nickel-rich prismatic and

cylindrical cells.

In June GM cut its annual EV production forecast as the

automaker banks on demand from its gasoline-powered models. GM

projected the higher end of its 2024 EV production to be 250,000

units, down from a prior forecast of 300,000 units.

($1 = 1,326.0000 won)