Johnson Matthey announced the sale of part of its battery materials business to EV Metals Group, a global battery chemicals and technology business, for GBP50 million cash.
Johnson Matthey will also receive a minority equity stake in EV Metals Group.
Completion of the deal is expected in summer 2022.
The sale included Johnson Matthey assets at its battery technology centre in Oxford and battery technology centre and pilot plant in Billingham, a research centre in Moosburg, Germany and a partly constructed site in Konin, Poland.
The sale did not include the LFP facility in Canada which will be acquired by Nano One, a clean technology innovator in battery materials, as announced earlier.
The sale also included eLNO technology, underpinned by the GEMX and CAM-7 cathode platforms the company licensed from CAMX.
EV Metals Group would continue to develop eLNO, building on successful customer testing to date.
“In our interim results we fully impaired the carrying value of our battery materials assets as at 30 September 2021, resulting in a charge of GBP314 million, and announced on 12th 2022 we anticipated additional cash costs up to £150m. After taking into account the proceeds of this sale these net additional cash costs are now expected to be no more than £50m,” Johnson Matthey said in a statement.
Chief executive Liam Condon added: “[We] made the decision to exit battery materials due to insufficient returns, increased commoditisation of battery materials combined with the need for very high capital investments to remain competitive. With EV Metals Group vision and capability to be a fully integrated battery chemicals business, I am very confident that they are the right owner for the business going forward.
“This important divestment means Johnson Matthey can now focus on our core portfolio.”
Michael Naylor, managing director and CEO of EV Metals Group, said: “The acquisition of the battery materials business is a strong strategic fit for EV Metals Group. It includes world class, leading technology for the production of cathode active materials. With our unique upstream, midstream and downstream business model, EV Metals is well positioned to drive the successful commercialisation of JM’s CAM technology, taking full advantage of the Group’s ‘mine to OEM’ integrated supply chain, which addresses the long-term market challenge of both surety of raw materials and the supply of processed materials.”
“EV Metals is committed to protecting all high-value, specialist jobs within JM’s battery materials business and to driving further job creation by building out a UK EV supply chain.”