In May 2021, battery separator firm Entek bought the majority stake in Japanese firm Nippon Sheet Glass’ (NSG) lead-acid battery separator business. BEST talks to Entek about the deal, how it will manifest itself and its repercussions for the global lithium-ion and lead battery industry.
Respect, integrity, commitment and innovation; four simple words that have connotations woven deep into the DNA of US firm Entek and Japanese company Nippon Sheet Glass (NSG).
The companies first worked together when NSG joined Entek-Separindo (a lead-acid battery polyethylene (PE) separator joint venture between Entek and Separindo). Then in 2019, the firms broke ground on an expansion to double the size of a PE separator manufacturing plant in Bogor, Indonesia. It was no surprise therefore, that in May, the ideology synced with the practical and Entek announced it had bought-out NSG’s battery separator business.
It is fair to say the companies had been on each other’s radar for a while, but the “timing just wasn’t right for either of us” before this year, says Clint Beutelschies (right), VP global sales at Entek, via a Zoom call from Singapore.
“There’s been opportunities where we’ve talked about some strategic investments and possibly working together in other geographical markets and other investment opportunities for many, many years before this,” says Beutelschies. “This was a very welcome step for us; we share a lot of the same corporate values. It was a great fit, and the time that we spent together in the joint venture from 2017 to where we are today, has borne that out.
“I think it’s good for NSG’s battery separator vision to join us. Previously they were part of a very large corporate structure before Nippon Sheet Glass, but by peeling them out and attaching them to Entek they’re now strategically aligned with a company that’s global in nature, but is strictly focused on the same strategic objectives that they are.
“They’ve got a host of their own technology and product portfolio that’s going to be additive to what we do. One of the great things about this is we are now the only company in the business that offers the three primary separator technologies.”
The new company, Nippon Sheet Glass Compass (NSGC), was established in Japan through an absorption-type split by NSG. The entire shares in NSGC are due to be transferred to Entek Technology Holdings in August when it will become its wholly-owned subsidiary through Entek Japan.
In addition to the elements of the business owned and operated directly by NSG, the entire share capital of Nissho Kako (a wholly-owned subsidiary of NSG in Japan), the entire holding in Tianjin NGF Glass Fiber (a wholly-owned subsidiary of NSG in China), and NSG’s holding in Entek Separindo Asia, are also included in the deal.
The Oregon, US-based firm now has one of the broadest product offerings in the market, including SLI products designed for applications like EFB, and features like controlled elongation, glass mat laminations and customer specific designs for automotive engineers.
The deal means Entek now has more than 400 million m² of aggregate PE separator production capacity globally (from its sites in the US, UK, Indonesia and Japan) to support its lead-acid battery customers around the world. That figure does not include absorbent glass mat (AGM) capacity (Japan and China) or its lithium separator capacity in the US.
A press release announcing the deal stated the buy-out would combine Entek’s core know-how in material science equipment engineering and design, and NSGs leadership and customer focus in Asia. In short, the synergy between the two companies would combine Entek’s technology and NSG’s geographical sales knowledge.
But that’s not the full story; one of Entek’s strengths is as a material science company, however, NSG has some great technology as well and they bring AGM technology to the relationship, which is a product that Entek doesn’t have today, Beutelschies says.
Its product range now crosses all three of the big technologies: polyethylene and lithium separators, and with the NSG buy-out, AGM separators for lead-acid.
Since its founding in 1984 by James Young and Pete Johnson, Entek has forged an industry leading position in North America’s auto industry. Starting with lead-acid battery separators, the firm now spans six continents.
The company also has a market presence in Europe, however it was underrepresented in the Asian market until 2017, when it added the Indonesian plant.
The logical progression in the company’s evolution was, therefore, to become the industry leader in Asia as well; if the joint venture in 2017 was the company taking its first steps, the Indonesian plant was it learning to walk, and the buy-out of NSGC is Entek running away with the business model.
NSG supplied the Asian and Japanese lead-acid battery separator market for decades from its manufacturing facilities in Japan and China.
Although Beutelschies would not go into details, he did hint at future additional investment from Entek, which includes not only more money into traditional lead-acid markets, but also plans for its lithium business.
“We have a lot of things in development right now, a lot of work with customers that are going to expand that business, but then we also see other emerging grid-scale type products that we think we might have to fit in as well,” says Beutelschies. “There’s a lot of opportunity in energy storage, and I think the portfolio of products that we have, and the products that we’re developing, are going to be well positioned for the future.”
Entek will continue looking for opportunities for investment and expansion, with some “great markets that we think are opportunities for additional investment in the region”, says Beutelschies.
“Asia, and China in particular, has been well out in front of the rest of the world, but we do see the lithium-ion business making a transition into Europe and North America as well. So I think that plays well to our strengths, as it relates to our lithium business; but for our lead-acid business, the Asian market has been the fastest growing, and we’ve been underrepresented there. We’ve been working hard to catch up.”
Daigo Furuichi (right), who will be president of NSGC, said they had been a local player for mainly Japanese customers previously, so combining NSG and Entek was the best way to compliment each other geographically, and combining the one team together enabled both firm’s strengths to be maximised.
“I think we both respect each other. Entek has great knowledge and customer base in Europe and North America, and we also have the good relationships with the Japanese-based customers,” says Furuichi. “We know the very unique requirement was to deliver services for Japanese customers, so there are good synergies we can share.”
Know-how and sales
Entek has a material science capability, whereby it can work with different formulations and different technologies, and has been able to adapt and grow because of that.
As it relates to lead batteries, Entek continues to work on what Beutelschies refers to as “tactical, as well as strategic” business models to allow the company to reach its vision for the future.
“Some of the more tactical things, I think, are making sure that, as a global organisation, we’ve got our systems and our procedures set up so that we are performing at all of our manufacturing sites as a great supplier to our customers,” says Beutelschies.
“As our technology evolves, we’re going to continue to make separators that meet the new requirements, whether that’s greater durability, new membranes, new coatings, new additives— all of those kinds of things— we’re bringing to bear in the market.”
An area in which separator technology is helping lead-acid battery makers is in reaching their goals of higher dynamic charge acceptance, partial-state-of-charge, depth of discharge and overcharging.
While every lead battery manufacturer has their own thoughts relative to what makes a high-performance battery, increasing performance is where most of the development investment R&D is happening.
Entek works with those battery makers through additives, separator profile design, or through thinning of the separator and more durable separators.
“We bring that portfolio and work with them to develop something that’s specific to them,” says Beutelschies.