Energy group Total's Saft arm strikes China batteries deal (updated)
04/04/2019 08:14
(Adds details, background, quotes)
PARIS, April 4 (Reuters) - The Saft subsidiary of French
energy group Total TOTF.PA has struck a new deal to expand its
presence in China in the fast growing market for batteries,
energy storage and electric vehicles.
Total said on Thursday that Saft had signed an agreement
with Tianneng Energy Technology 0819.HK to create a joint
venture to expand their lithium-ion activity.
The companies did not disclose the value of the deal.
Manufacturing will be based at the Changxing Gigafactory,
with a potential capacity of 5.5 gigawatt hours (GWh), part of
which is already in operation.
Total's Saft arm will have a 40 percent shareholding in the
new venture, while Tianneng will hold the remaining shares.
The companies said they plan to expand the Changxing
facility and ramp up its production capacity to meet future
growing demand, mainly driven by e-mobility sales and the
development of renewable electricity generation capacity.
The deal gives Saft and Total an entrance into the Chinese
battery market as European manufacturers race to catch up with
Asian rivals in the fast growing market.
Saft, a 100-year old French company that specializes in
industrial batteries, is leading a European consortium that
includes Siemens SIEGn.DE , Solvay SOLB.BR , Manz M5ZG.DE ,
Umicore UMI.BR and Eramet ERMT.PA , which hopes to build a
European battery giant.
"The joint venture will allow Saft to join forces with a
Chinese partner, a world leading lead acid battery manufacturer,
willing to develop its lithium-ion activities," Total's Chief
Executive Officer (CEO) Patrick Pouyanne, said in a statement.
"It will also give Saft access to China’s booming battery
market as well as highly competitive mass production capacity to
accelerate its growth," he added.
Saft's CEO Ghislain Lescuyer, said the deal will allow the
company to make a change in scale and significantly increase its
footprint in the Chinese Li-ion battery market that will
represent over 40 percent of the global demand by 2025.
(Reporting by Sudip Kar-Gupta and Bate Felix
Editing by Inti Landauro/Keith Weir)
((sudip.kargupta@thomsonreuters.com; +33 1 49 49 53 84;))