JM to close Battery Materials
Following discussions with various parties about a sale of its Battery Materials business, Johnson Matthey (JM) has announced that it has not been able to reach an agreement to sell the business as a going concern. It is therefore beginning consultation with employees about proposed closure of the business and pursuing the sale of its individual assets.
In November, following a detailed review, JM concluded that the potential returns from Battery Materials “will not be adequate to justify further investment” and that it would therefore seek to sell all or parts of the business. Despite strong demand growth, fierce competition and increasing commoditisation were leaving it unable to compete against other technologies and “more established large-scale, low-cost producers”.
As recently as April 2021, Battery Materials was cited as an area of greater focus for the future. The company had invested about £150 million in R&D into eLNO, a high-nickel cathode material, a 10,000 tonnes/year plant was due to open in Poland in 2024 and a second, larger one was already in the planning stages.
The company took an impairment charge on the business of £314 million in its interim results but expects more to arise as a result of settling contractual liabilities, redundancy, closure and abandonment costs. These are currently estimated at around £150 million. About 430 jobs are at risk.