Nissan’s EV battery partner looks to sell stake to China's GSR

As per Nikkei, the Japan-based Nippon Electric Company (NEC) is in final talks for selling its battery electrode subsidiary to the Chinese investment group GSR.

The Tokyo-headquartered manufacturer has offered to sell NEC Energy Devices for about 15 billion yen (Rs 780 crore) to GST, along with negotiating to buy NEC's interest in a battery joint venture with Nissan Motor.

NEC Energy Devices mostly produces electrodes used in lithium-ion batteries for Nissan's Leaf electric cars, with annual sales estimated to be at about 15 billion yen (Rs 780 crore).

Narrow customer base
As per the report, the battery maker which relies heavily on Nissan for sales of its lithium-ion batteries that go in the Nissan Leaf, is looking forward to expanding its battery supplier network. While top players in automotive lithium-ion batteries continue to make massive investments in the field, NEC requires huge amount of investments to keep its battery business competitive and the lack of synergies in its operation is the reason the Japanese battery maker has decided to exit the space.

Also, NEC has reached a broad agreement for selling its interest in Automotive Energy Supply, a Japanese battery venture with Nissan, to GSR in negotiations led by the Japanese automaker. NEC and NEC Energy Devices currently hold a combined 49 percent stake in the venture.

While Nissan is also selling its stake in Automotive Energy Supply, that produces batteries using electrodes from NEC Energy Devices. The company will still continue to research and develop next-generation batteries and will turn to external battery suppliers trying to cut production costs for its electric vehicles.

While GSR has invested in American and Chinese car battery makers, and with stiffer environmental regulations expected to boost the electric-car market in China, the company seems to be looking to build a steady supply network for high-quality batteries there.