(Yicai Global) May 10 -- Shares of China's Fangyuan Environment rose after the battery parts maker said it will team up with a recycling partner to jointly invest CNY1 billion (USD149 million) to expand its ternary cathode material output.

Fangyuan's stock price [SHA: 688148] climbed 4.9 percent to close at CNY15.60 (USD2.30). Still, the shares are more than 50 percent down in value this year.

The battery materials supplier will join hands with Feinan Resources Recycling to build a joint venture in southern China's Laibin, Guangdong province-based Fangyuan said in a statement yesterday.

The JV in the Guangxi Zhuang Autonomous Region will have an annual capacity of 50,000 tons of ternary precursor products. Fangyuan will have a 51 percent stake in the JV and Feinan will have 40 percent of the equity. A private equity fund will hold the remainder of 9 percent.

The partnership involves synergies. All major raw materials, namely high-purity nickel sulfate, will come from the partner’s scrap metal recycling plant, according to the statement. Fangyuan will support the endeavor via its production technologies.

Feinan is engaged in the nonferrous metal recycling business to regenerate nickel sulfates. Its annual capacity of the key cathode material should rise to a sum containing 20,000 tons of nickel when the first phase of its ongoing recycling project in Guangxi is ready, based on the announcement.

Fangyuan is one of China’s major producers of ternary precursors. By December, the firm's annual capacity should rise to around 100,000 tons from 36,000 tons. The company has a 20 percent stake in a battery recycling project built by French resource management firm Veolia Environment in Guangdong province's Jiangmen. The plant can process 20,000 tons of battery packs per year, according to the Chinese partner's website.

Editor: Emmi Laine, Xiao Yi