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Nissan cancels battery unit sale to China's GSR Capital

ABR Staff Writer Published 02 July 2018

Japanese automaker Nissan has abandoned the deal to sell its EV battery manufacturing unit to Chinese private equity firm GSR Capital.

The deal, valued at nearly $1bn, was cancelled by Nissan stating that the Chinese firm lacked the finances to back the transaction. The deal was postponed three times, most recently in April.

In August 2017, GSR Capital signed an agreement with Nissan to acquire the business unit, Automotive Energy Supply Corporation (AESC), from the automaker.

The deal included the battery manufacturing operations in the US and the UK and part of the company’s battery development and engineering operations in Japan.

Nissan’s battery operations include the full value chain from research & development, cell manufacturing, module/ pack assembly and battery management systems.

AESC’s lithium-ion batteries are used to power more than 270,000 Nissan LEAF vehicles across the world.

With the deal scrapped, the Japanese automaker is now evaluating its options and it is early to decide on what it will do with the business unit. Nissan expected to invest the proceeds from the sale in new technologies, such as autonomous driving, reported by Bloomberg.

For several years, Nissan has been saying that it is economically viable to buy batteries from supplier than producing them, the publication said.

In 2007, Nissan established Automotive Energy Supply jointly with NEC to produce batteries for the all-electric Leaf when few other battery suppliers existed in the industry.

Earlier, Panasonic was also in talks with Nissan to buy the battery producing unit, sources have told Reuters. Along with LG Chem, Samsung SDI, and China-based CATL, Panasonic is a key supplier of electric car batteries, producing them for Tesla.

With offices in Beijing, Hong Kong and Palo Alto, GSR Capital focuses on investments in high growth sectors in electric vehicles, new energy, modern agriculture, healthcare and wireless technologies.


Image: Nissan global Headquarters. Photo: Courtesy of Nissan.