Nissan has officially announced it will sell its electric battery operations and production facilities to GSR Capital (GSR), a Chinese private investment fund. The sale and purchase agreement will include not only include Nissan’s battery subsidiary, Automotive Energy Supply Corporation (AESC), but also its battery manufacturing operations in Smyrna, Tennessee and in Sunderland, England.

Assets sold to GSR will also include part of Nissan’s Japanese battery development and production engineering operations located in Oppama, Atsugi and Zama. “This is a win-win for AESC and Nissan. It enables AESC to utilize GSR’s wide networks and proactive investment to expand its customer base and further increase its competitiveness. In turn, this will further enhance Nissan’s EV competitiveness (vehicle development),” said Hiroto Saikawa, president and chief executive officer of Nissan.

“AESC will remain a very important partner for Nissan as we deepen our focus on designing and producing market-leading electric vehicles,” he added. The subsidiary is responsible for producing lithium ion batteries for the Leaf electric car.

“The acquisition of AESC represents an important step for us in the new energy vehicle industry chain. We plan to further invest in R&D, expand existing production capacity in the U.S., UK and Japan, and also establish new facilities in China and Europe, enabling us to better serve customers around the world,” noted Sonny Wu, chairman of GSR Capital.

“With these capabilities and plans added to the battery business’ already skilled workforce, high technical capabilities and proven product-quality track record, we will be in a very good position for growth,” he continued.

Nissan will implement the transaction by first taking full control of AESC by acquiring the combined 49% minority holding held by NEC Corporation and its wholly owned battery and electrode subsidiary, NEC Energy Devices (NECED).