Umicore announced yesterday evening that it had reached an agreement to set up a joint venture with South Korean industrial group HS Hyosung Advanced Materials specializing in the development of silicon-carbon composite anode materials for lithium-ion batteries for electric vehicles (EVs), a project in which it will hold only a minority stake.

Under the terms of the strategic partnership, the financial details of which have not been disclosed, the Belgian specialty materials group will control only 20% of the joint venture, called 'The Extra Mile', which has set itself the goal of starting up an industrial demonstration plant in Olen (Belgium) by the end of 2026.

After more than a decade of research and development (R&D), Umicore believes that this center dedicated to anode technology is ready to move to industrial-scale production.

All Umicore employees working in the field of anode materials will be transferred to The Extra Mile and will retain their terms of employment.

In a reaction note, KBC analysts acknowledge that this strategy will enable the company to limit the costs associated with rolling out its anode technology, as it has already done in the field of cathode materials by opting for cautious and measured development, but believe that it is still too early to determine whether the joint venture will be successful given the uncertainties that still surround the growth of this technology.

Even so, on the Brussels Stock Exchange, Umicore's shares fell over 3% after this announcement, although they are still up over 60% YTD, buoyed by the recent surge in metal prices.