Tata Chemicals Ltd. is in discussions with London-based Johnson Matthey Plc to buy the company’s battery materials business, the Mint news reported, citing two people with direct knowledge.
Tata Chemicals is one of the frontrunners to acquire the assets, the two people told the Indian news daily.
A deal for the battery materials unit could fetch $500 million to $700 million, according to Mint, adding that talks began after the company decided to exit the business.
Talks between the two companies began after Johnson Matthey announced two weeks ago, alongside a group profit warning, that it planned to exit the battery materials business because the potential returns did not justify further investment.
Johnson Matthey was developing a nickel-rich cathode material it called eLNO. It has invested about $200 million in R&D to develop the cathode material and has valued the assets of the business at about $450 million. The business has about 430 employees, most of whom are based in the UK.
The firm had been planning to open a 10,000-metric-ton-per-year cathode material plant in Poland in 2024 and had already begun planning the construction of a second, bigger plant.