Reliance New Energy to buy Lithium Werks, Belgium

reliance-expands-renewable-footprint

Indian Market
by 5paisa Research Team Last Updated: 2022-08-08T19:03:09+05:30

Reliance New Energy Ltd, a subsidiary of Reliance Industries, has agreed to acquire the assets of Lithium Werks of Belgium. The total consideration will be $61 million and this includes funds to finance the working of the company post the deal.

Lithium Werks is a manufacturer of cobalt-free lithium batteries and uses its own proprietary technology. The acquisition deal will include the patents, the manufacturing plant as well as order book.

The deal provides Reliance New Energy the access to high-performance lithium iron phosphate (LFP) batteries business of Lithium Werks.

In the light of the transition of batteries from traditional batteries to specialized batteries to cater to renewable energy sources, this is timed to synchronize with the big leap that Reliance is making in the field of new and innovative energy. There is resurgence in demand for LFP batteries of late.

The traditional batteries were called NMC batteries or Nickel, Manganese, Cobalt batteries. Due to the presence of these metals, the life of the batteries were limited. The new LFP batteries are free of nickel and cobalt and are not only low cost batteries but also high on performance.

Hence they are best suited for emerging sources like renewable plants, electric cars etc, where the need is adaptability, endurance and economical costs. 
 

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It may be recollected that in the last AGM of Reliance Industries, they had laid out a plan to invest Rs.75,000 crore in new energy initiatives over the next 10 years. The idea was to fuel its commitment to become net carbon neutral by 2035.

Incidentally, Lithium Werks has an intellectual property (IP) portfolio of 219 patents related to LFP process and technology. It also has an IP driven product pipeline and integrated cell manufacturing capability.

This deal must be seen in conjunction with the recent acquisition of Faradion of UK for £125 million. Faradion is a UK based start-up which develops sodium-ion batteries using sodium, which is abundantly available in nature.

The acquisition of Lithium Werks complements the original buy of Faradion. It helps Reliance New Energy to beef up its technology portfolio for battery cells and catalyse building large scale battery manufacturing facilities.

Reliance will invest Rs.75,000 crore over the next 3 years to build a new clean energy franchise towards making Reliance carbon neutral by 2035.

Among other things, this mega plan will include the building of 4 giga factories for making components, building the value chain, partnerships and future technologies and re-purposing Reliance’s engineering, project management and construction capabilities toward clean energy.

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