Sony in talks for lithium-ion battery business integration

Panasonic and Sony are Japan’s biggest makers of lithiumion batteries.

A Japanese state-backed fund wants a Nissan Motor Co Ltd and NEC Corp joint venture to buy Sony Corp’s lithium-ion battery unit to prevent rivals in China and Taiwan from getting its technology as the Tokyo TV maker looks to offload non-core businesses, the Daily Yomiuri said.

Sony Corp.’s troubled lithium-ion battery business may be integrated with a joint venture of Nissan Motor Co. and NEC Corp., under an initiative of a state-backed investment fund, sources said.

The lithium-ion battery is considered a homespun technology in Japan, as Sony commercialized the first battery of its kind in 1991. But overseas rivals have recently surpassed Japanese makers in terms of their share of the market for compact lithium-ion batteries used in personal computers and other products.

As Taiwan and Chinese makers have shown an interest in investing in Sony’s lithium-ion business, the investment fund Innovation Network Corporation of Japan (INCJ) plans to reorganize the domestic industry. The fund intends to ensure technical expertise is retained domestically, according to the sources.

Currently, INCJ is favorably considering an integration between Sony’s subsidiary for its lithium-ion business and a battery firm established by a joint venture of Nissan and NEC, the sources said.

INCJ has been mediating talks between Sony Energy Devices Corp. and Nissan and NEC’s Automotive Energy Supply Corp., in hope of completing the integration by the end of fiscal 2013.

The plan currently under discussion entails Sony selling most of its shares to the joint venture, with INCJ also putting in capital for the integration, the sources said. They added that the talks are now at a stage in which details such as the selling price for shares are being negotiated.

If negotiations fail, INCJ will likely seek other domestic companies to partner with Sony’s subsidiary, the sources said.

Additionally, Taiwan’s Hon Hai Precision Industry Co., which has been negotiating with struggling Sharp Corp. over capital investment, and China’s automaker BYD Co. are said to be interested in Sony’s battery subsidiary. INCJ therefore plans to accelerate the domestic reorganization of the industry, according to the sources.