Johnson Matthey to leve the battery materials space
British speciality chemicals company, Johnson Matthey, is giving up its activity in the battery materials sector.
Johnson Matthey has been working to commercialise its range of high nickel cathode materials, principally for the automotive industry. However, following a detailed review the company says that it has concluded that the potential returns from its Battery Materials business "will not be adequate to justify further investment." Whilst the company admits in a press release that demand for battery materials is accelerating, so is also competition from alternative technologies and other manufacturers. Which also means that this market is rapidly turning into a high volume, commoditised market. In recent months the company has been exploring strategic partnerships, and according to the company it has become clear that its capital intensity is too high compared with other more established large scale, low cost producers. This has led to the board of directors deciding to pursue the sale of all or parts of this business with the ultimate intention of exiting it completely. "We will move swiftly to determine the best outcome for all of our stakeholders and intend to make a further announcement as soon as possible," the press release reads. “While the testing of our eLNO battery materials with customers is going well, the marketplace is rapidly evolving with increasing commoditisation and lower returns. We have concluded that we will not achieve the returns necessary to justify further investment,” says Chief Executive Robert MacLeod in the press release, and continues. “This decision will allow us to accelerate our investment and focus on more attractive growth areas, especially where we have leadership positions such as in hydrogen technologies, circularity and the decarbonisation of the chemicals value chain.”