BASF and Shanshan in Chinese Battery JV

11.06.2021 - BASF is forming a majority-owned 51:49 joint venture with Hunan Shanshan Energy to make cathode active materials (CAM) and their precursors (PCAM) in China, the world’s the largest battery materials market. The chemicals are a key component of lithium-ion batteries, which are in strong demand, thanks to the growing market for electric vehicles.

Closing of the transaction is targeted for late summer following all approvals.

BASF was one of the first international companies to be permitted majority ownership of a company headquartered In the People’s Republic. In the partnership with Shanshan, a lithium-ion battery materials manufacturer supplying both the e-mobility and the consumer electronics markets, the German chemical giant will gain access to the Chinese CAM market and expand its global footprint in the global supply chain.

BASF said it will contribute its strength as a leading supplier of CAM to the automotive industry with strong technology and development capabilities and a global operations footprint, as well as strategic partnerships for raw materials supply. The jv will enable it to build up an integrated global supply chain for customers in China and worldwide, increasing its worldwide annual capacity to 160,000 t/y by 2022 with further expansions underway.  

Through the link with BASF, Shanshan, which has been engaged in the lithium-ion battery industry for more than 18 years, will be able to boost competitiveness even in its own home market by leveraging the German partner’s global automotive customer network.

Acccording to BASF, the collaboration will generate significant technology synergies. Shanshan, which has a comprehensive portfolio covering the main categories of the CAM and the corresponding PCAM used in lithium-ion batteries, has formed a business value chain that includes raw materials, PCAM, CAM and battery recycling.

The Chinese company operates four production sites for CAM and PCAM in Hunan and Ningxia, China, and expects to have annual capacity to produce 90,000 t/y of the materials by 2022.

BASF is already well established as a high-energy-density CAM manufacturer in Asia and North America. In Europe, it is investing in CAM capacities in Germany and PCAM capacities in Finland. The deal with Shanshan will make it the first company to have capacities in all major markets by 2022.

Author: Dede Williams, Freelance Journalist