MONBAT GROUP – European Power Player, an Interview with Atanas Bobokov

The current post-COVID surge in demand for plug-in vehicles, stateof-the-art smartphone apps and energy storage capacity is fueling a seemingly relentless demand for lithium-ion rechargeable batteries.

Yet while their high-energy density, low discharge rate and basic versatility mean that the lithium-ion battery market is expected to grow from $41 billion in 2021, to $116 billion by 2030, vast swathes of the industrial world still rely on lead-acid batteries. Thanks largely to their tried and tested technology and cost effectiveness, demand for lead-acid batteries is also booming and is expected to underpin a market of its own that will be worth $77 billion by 2026.

MONBAT GROUP has a foot in both camps. Set up as a state-owned enterprise in 1959 in the northwestern Bulgarian town of Montana to supply the Soviet Union with lead-acid batteries to support its heavy-industry expansion strategy, the company was acquired by the Bobokov brothers in 1998. Since then, MONBAT GROUP has grown into one of the largest battery producers in Europe by pursuing a policy of market and product diversification. In addition to selling into more than 70 countries around the world, MONBAT has also extended its range of products and service to include lithium-ion batteries and the recycling of the lead, lead alloys and the regranulated polypropylene used in conventional battery production.

It’s a successful formula. Between 2012 and 2020, sales grew by 66% and topped $200 million when the pandemic hit. Now, according to MONBAT GROUP majority shareholder Atanas Stoilov Bobokov, the company has regained its forward momentum. COVID slowed us down, he concedes, but our plans for the next five years remain ambitious.

Those plans are also highly focused. Despite the enthusiasm surrounding lithium-ion batteries, Bobokov is confident that demand for the company’s historically core lead-acid battery range of products will continue to grow for several decades to come, although client requirements will almost certainly evolve. In 2018, in anticipation of this, the company acquired the license for Advanced Battery Concepts’ GreenSeal bipolar technology, which drastically simplifies lead battery manufacturing and significantly improves performance by increasing cycle life, lowering weight, reducing recharge time and improving reliability, while also being fully recyclable.

The technology corresponds perfectly with new regulations in the eu and requirements elsewhere, says Bobokov. MONBAT GROUP is now looking for investors to help develop the world’s first manufacturing plant capable of producing batteries that fully utilize the new technology, while also providing facilities to explore new trends in the reserve power market.

Bobokov and his colleagues have identified opportunities in the lithium-ion battery market that will avoid putting them on a competitive collision course with major European, Chinese and US manufacturers. We would like to specialize in high-power lithium-ion batteries that are used by smaller industrial segments than those designed for electric vehicles, for instance, he says. These are niches that we don’t think will be of interest to the industry giants because the numbers are smaller and the markets are more fragmented.

Ferry boats offer one such opportunity. A new EU directive stipulates that no ship or other vessel is allowed to enter a port with its main engine on, meaning that they will have to rely on their auxiliary back-ups. Although this is a niche market, we believe that there is every chance it could become a big one, he says. But developing it is going to be a capital-intensive exercise, and we are looking for a partner to work with us. If we can find the right one, we could build a showcase plant in Bulgaria and then replicate it anywhere else in the world we wanted.

Montana is located at the very heart of the Balkans, and over the years the company has made full use of this to push into markets in both Western and Eastern Europe. Now, as the cost and weight of rechargeable power units continue to drop, demand is increasing across countries where access to electrical grids remains patchy. The starter battery segment is also showing no signs of a slowdown. A steadily greater proportion of our sales is now coming from regions where electrification will not come anytime soon, says Bobokov. While this has resulted in Monbat Group’s pan-African footprint growing, the quality of its products and its competitive pricing have also led to more orders from several developed Far East markets, including Japan and Taiwan.

With all three business lines facing towards growth markets, Bobokov is now looking for partners in earnest. Our challenge is not our products or their market potential, it is meeting the demand with the current production capacity.