(Yicai Global) Nov. 16 -- Chinese battery components maker Easpring Material Technology and South Korean battery maker SK Group have teamed up to develop cathode materials.

The comprehensive agreement will help Easpring to further integrate into the global high-quality electric vehicle industry chain and continue expanding its market share in Asia, Europe, and the United States, the Beijing-based firm said in a statement yesterday.

Traditional carmakers are speeding up their shift toward making new energy vehicles as sales of NEVs have exploded in Asia, Europe, and the US in recent years.

Under their agreement, SK will acquire as much as 30 percent of Easpring’s new materials industry base in Europe, the Chinese firm said. The pair will also set up a joint venture in South Korea, and another one in China, if deemed necessary.

Easpring is a long-term supplier of battery materials to Seoul-based SK and its units. Their supply deals were rose from CNY16.1 million (USD2.5 million) in 2018 to CNY834 million last year, accounting for 0.5 percent and 26.2 percent of Easpring’s revenue in those years, respectively.

Easpring said the latest deal will have no significant impact on its financial and operating results this year.

Shares of Easpring [SHE:300073] closed 1.3 percent lower today at CNY90.76 (USD14.23), after gaining as much as 4.3 percent in early trading. The stock has gained 40 percent so far this year.

SK’s power battery unit SK Innovation ranked sixth in the world for installed capacity in the first half, with a market share of 5.2 percent, according to SNE Research. Its main clients are carmakers such as Volkswagen, Ford Motor, Daimler, Hyundai Motor, and Kia.

Editor: Futura Costaglione