Belgian Umicore raises over $1bn to grow cathode production

Umicore said it raised 892 million euros ($1.09bn) by selling shares and will use the money in part to fund investments in battery materials. The programme is to run throughout 2020 and includes construction of the first cathode material production site in Europe.

Belgian Umicore said the new shares represent 10 percent of the number of outstanding shares prior to the transaction and will fund an investment programme that emphasises the company’s fast-growing rechargeable battery material business. An extra 660 million euros will be used to expand production capacity for materials used in batteries such as nickel manganese cobalt (NMC).

Umicore said the investment programme would run through 2020 and involve the construction of new site in Jiangmen, China and a first cathode material production site in Europe.

The move had been planned last May, when Umicore stated its ambition to raise 300m euros. The tripling of that sum and the planned European facility indicates both current as well as expected growth. Marc Grynberg, Umicore’s CEO said in a statement: “I am delighted with this very successful transaction. We managed to raise close to 900 million euros of new equity in about two and a half hours despite a challenging climate in global equity markets. I see this as a clear vote of confidence of our investors in the strategy and positioning of Umicore.”

Umicore is also part of the Fab4Lib consortium that just started its research and development of large scale battery cell production processes in Germany (we reported).

Demand for cathode materials is expected to grow with carmakers scrambling to fulfil tightening emission regulations. Not only in China but with countries in Europe such as the Netherlands, France or Great Britain planning to ban sales of diesel and petrol cars by 2030 or 2040. The same is true for Japan and California who had stated to aim for zero emissions just weeks ago.