SK Innovation and German automotive parts supplier Continental have teamed up to develop batteries for electric vehicles through a joint venture scheduled to begin within the year in Berlin, Korean company officials said Tuesday.

Under an agreement signed on Monday at Continental’s headquarters in Frankfurt, the two companies agreed to invest a combined 270 million euros ($330 million) into the joint venture in the coming five years.

SK Innovation, a flagship unit of SK Group, will hold a 51 percent stake of the jointly managed firm, providing its technology in the development of battery cells. Continental, with the remaining 49 percent stake, will offer battery management systems for vehicles. 

According to SK officials, it is a rare case for a battery manufacturer for electric vehicles to join hands with an automotive parts supplier, not carmakers.

The two companies, which have already worked with global carmakers like Hyundai Motor and Daimler, expect synergy through the new joint venture in securing more business clients in the field of environment-friendly cars.

Along with creating the joint venture firm, they also agreed on Monday to operate two research centers in Berlin and Daejeon, some 160 kilometers south of Seoul, for local production and marketing activities, officials said.

The signing ceremony was attended by some 50 company officials, including SK Group executive vice chairman Chey Jae-won, SK Innovation CEO Koo Ja-young and Continental CEO Elmar Degenhart.

“Through the new joint venture, SK will step up efforts to expand presence in the global electric car market,” said an SK Group spokesperson.

By Lee Ji-yoon (jylee@heraldcorp.com)