By Yadarisa Shabong
-Johnson Matthey said on Wednesday it plans to close its battery materials business, putting about 430 jobs at risk, as the British chemicals firm has not found a buyer for the entire unit.
The company, which announced plans in November to exit the battery materials business, said talks with a number of unnamed parties have not led to an agreement.
Shares in the FTSE 250 firm fell as much as 4% after the news.
JM said it was now pursuing the sale of the division’s individual assets.
JM, like larger European rivals Umicore of Belgium and Germany’s BASF, had bet on growth in cathode materials, the most complex chemical component of an automotive battery, to offset an expected decline in their lucrative businesses supplying catalytic converters for cars.
JM’s decision to exit the battery materials business was due to crushing competition and low returns.
Last month, Umicore cut its outlook for cathode materials, saying sale volumes would fail to keep pace with global market growth.
Other players in the battery materials market include China’s Beijing Easpring Material Technology and South Korean companies LG Chem Ltd and Posco Chemical.
JM said it was starting a consultation with its employees about the closure. A majority of the permanent staff at JM’s battery materials business are in the United Kingdom.
The London-based company, which is bringing in Bayer’s Liam Condon as chief executive officer in March, said the closure would lead to additional impairment charges, job cuts and other costs.
It has already taken a charge of about 314 million pounds related to the business as of September, and the closure will lead to cash costs of about 150 million pounds ($205.34 million), Johnson Matthey said.
($1 = 0.7305 pound)