TOKYO — Last summer, Nissan Motor Co. struck a deal it said epitomized the winning strategy for the coming era of new mobility. The Japanese automaker would offload its global lithium ion battery business, freeing up resources for other next-generation technologies.
But that deal has collapsed, Nissan said last week, because its eager Chinese buyer was unable to come up with the necessary funds.
The turn of events leaves Nissan in a bind as it prepares to develop an expanding fleet of electric vehicles for world markets. But it also highlights important changes in China.
The first is the rise of homegrown Chinese battery makers into global players. The second is a slowdown in the country's once unbridled appetite for overseas acquisitions at any cost.
"It used to be they'd eat anything that's out there. But their belly's not as empty anymore," said Bill Russo, CEO of the Shanghai consultancy Automobility and a former China executive at Chrysler and auto electronics supplier Harman. "They are more sophisticated investors."
Nissan had arranged last year to sell its multiplant in-house battery manufacturing unit Automotive Energy Supply Corp. at a whopping ¥100 billion ($903 million), according to Japanese media reports. The buyer was GSR Capital, a Chinese private investment fund whose holdings include Iconiq Motors and Fisker Inc.
But when the June 29 closing day arrived, GSR had backed out.
According to a Nissan filing with the Tokyo Stock Exchange, GSR Capital "was not able to have the funds available to fulfill its contractual obligations." Nissan, still saddled with a battery maker set up more than a decade ago to supply the Leaf EV, says it's unsure what to do next.
How the deal fell apart is unclear. Nissan spokesman Nicholas Maxfield declined to comment beyond saying it was not derailed by a regulatory holdup. GSR Capital representatives in China and the U.S. failed to return phone calls.
But analysts say the breakdown likely hinged on Nissan's asking price and the technology GSR Capital would reap in return. In announcing the deal last year, GSR Capital seemed to value AESC more for its global footprint than any cutting-edge technology it might have.