Car Battery Capacitor Maker Maxwell To Be Bought By Tesla For $218 Million

There is a growing need for more and more car batteries for electric cars across the world as more car makers make significant investments in the car of the future. Industry experts have also pointed out that it would be critical for electric car makers to first ensure a steady supply of batteries for their cars and then to try and reduce the costs of batteries powering and driving electric cars which would ultimately also bring down the overall price of the electric cars. That can be a competitive advantage for those car makers who are able to do so.
 
This is precisely the reason that the US based electric car maker Tesla has decided to purchase Maxwell Technologies Inc in a deal worth $218 million. This all-stock deal, according to experts, would help the car maker to make significant enhancement to its battery technology which is critical because the company is set to increase production for its most affordable Model 3 sedan cars – the success of which has been identified to be critical for the survival of the company.
 
Ultracapacitors which are put to use in automobile batteries for increasing the shelf life of the batteries is manufactured by Maxwell and delivered to its clients that includes car makers such as General Motors and Lamborghini. The ultracapacitors made by the company are also put to use for storing electricity on power grids.
 
Two of the main products of Tesla – the electric cars and backup power for homes and power utilities, are critically dependent on furthering their prospects through enhancement of power storage.
 
“We are always looking for potential acquisitions that make sense for the business and support Tesla’s mission to accelerate the world’s transition to sustainable energy,” said a Tesla spokesperson while talking about the deal.
 
The companies said that the deal sets that value of each share of Maxwell at $4.75 which was 55 per cent more than the closing price of the stocks last week. There was a rise in shares of Maxwell following the announcement of the deal.
 
Tesla currently gets all of its batteries for its cars from Panasonic Corp of Japan exclusively.
According to a blog post on Maxwell’s website, increasing battery life by up to two times, extension of operational temperature range and enabling of rapid response times is possible through the use of ultracapacitors in conjunction with the energy of batteries.
 
The importance of ultracapacitors was highlighted by Tesla chief Elon Musk as far back as 2013. "I'm a big fan of ultracapacitors. Was going to do my PhD at Stanford on them. But we need a breakthrough in energy density...," Musk had tweeted then
 
The deal has already been approved by the board of Maxwell and the company expects it to get completed by the second quarter of 2019, or within a short period of time after that.
 
(Source:www.marketwatch.com)