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*** For immediate use March 24, 2014
Tokyo, March 24, 2014 - NEC Corporation (NEC; TSE: 6701) announced today the acquisition of the A123 Energy Solutions business unit of A123 Systems, LLC. This acquisition, for approximately USD $100 million, strengthens the energy storage capability of NEC's smart energy business, a core segment of its Mid-term Management Plan's commitment to social infrastructure. A123 Energy Solutions will be integrated into the NEC Group of companies and operated globally as a key element of its business. An agreement on the terms of the deal has been finalized and a new company "NEC Energy Solutions" is slated to begin operation in June 2014 under the direction of NEC. A123's existing cell manufacturing and sales, research and development, and automotive operations will remain the core focus of A123 Systems, LLC.
With this acquisition, NEC will become the world's leading supplier of lithium-ion grid energy storage systems. A123 Energy Solutions has deployed over 110MW of its Grid Storage Solutions (GSS(TM)) worldwide with the vast majority of these systems already in revenue service. The company will continue to supply systems utilizing A123 Systems' Nanophosphate(R) lithium-ion cells and support all existing installations. NEC Energy Solutions, with access to NEC Corporation's world-class information communications technology (ICT) and A123 Energy Solutions' system integrations expertise, is now better prepared to address the increasing global need for energy storage. In addition, NEC's high quality, cost-effective lithium-ion technology adds to the ever-growing portfolio of energy storage technologies available for future use in A123 Energy Solutions' GSS platform. At the same time, NEC will leverage A123 Energy Solutions' experience in commercial batteries in order to serve NEC's telecommunication carrier, enterprise and government customer base, thereby helping to drive the global expansion of NEC's smart energy business.
"With these combined strengths, NEC Energy Solutions will be able to help satisfy the growing demand for energy storage worldwide, whether driven by increased penetration of renewable energy from wind and solar, more effective grid stabilization services like frequency regulation and frequency response, or the desire for more efficient reinforcement of existing transmission and distribution grids," said Takemitsu Kunio, Senior Vice President of NEC Corporation. "Improving energy reliability, sustainability, and security, we will provide turn-key energy storage solutions, ranging from utility-side storage at the megawatt scale, down to behind-the-meter storage at the kilowatt scale for residential, commercial, or industrial sites."
A123 Systems, through its A123 Energy Solutions unit, has been regarded as a leader in lithium-ion grid energy storage systems. It provides not only the energy storage technology, controls, and supporting equipment in a turn-key packaged solution, but also the application modeling to properly size an energy storage solution, and the service and support required to maintain safe, high performance energy storage operation. A123 Energy Solutions has supplied some of the world's leading utility companies and independent power producers around the world including applications in North America, South America, Europe, the UK, and Asia, including recent 2MW and 500kW installations in China. NEC is slated to establish a joint venture company with Wanxiang and its affiliates to address the growing China market.
"We are delighted by the combination of strengths of the two companies," said Bud Collins, President of A123 Energy Solutions. "Combining our experience in the grid storage space with the world's leading utilities and power producers, NEC's strength in ICT, and its lithium-ion manufacturing scale, we believe the resulting company will be a formidable organization, well-equipped to handle the emerging smart energy sector across the globe."
Looking to the future, NEC has grand ambitions for its new NEC Energy Solutions venture. Working towards the safety, security, efficiency and equality of society, it will explore new business opportunities to promote the creation of next generation energy services, enabled by information communications technology, intelligent controls, and advanced energy storage systems. Using its ICT capabilities as a core of its "Solutions for Society", NEC seeks to enable a more energy efficient society and develop advanced social infrastructure solutions to address a wide range of social issues.
Presentation - NEC acquires the energy storage system business of A123 Systems from Wanxiang
About NEC Corporation
NEC Corporation is a leader in the integration of IT and network technologies that benefit businesses and people around the world. By providing a combination of products and solutions that cross utilize the company's experience and global resources, NEC's advanced technologies meet the complex and ever-changing needs of its customers. NEC brings more than 100 years of expertise in technological innovation to empower people, businesses and society. For more information, visit NEC at http://www.nec.com.
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