The Chinese owner of London’s iconic black cab has raised $400m (£273.8m) in a bid to introduce "clean taxis" on London roads.

Zhejiang Geely Holding Group Co. secured the funds to electrify black cabs through a green bond sale that is rumoured to have been oversubscribed by eight times.

The company intends to use the funds for developing the TX5, a hybrid battery-powered version of its 1958 FX4 model.

Geely is set to start work on the prototype of the TX5, that will be launched next year, at its new factory in Coventry by the end of the month. The company aims to manufacture 36,000 electric cabs a year.

Frank Li, group chief financial officer, told Bloomberg: “This is a landmark for us, not only in the sense of the funds raised, but also the purpose.

“We’re going to do a clean taxi not only for the UK market, but it’s going to be a global product that we can definitely grow our to help reduce emissions and provide a cleaner environment for everybody.”