SoftBank has announced that it will begin manufacturing battery cells and energy storage systems at its facility in Sakai, Osaka, targeting gigawatt-hour-scale production by the fiscal year ending March 2028.

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The Japanese company is partnering with two South Korean startups, Cosmos Lab and DeltaX, to produce zinc-halogen batteries that use water-based electrolytes instead of the flammable organic solvents found in lithium-ion cells. SoftBank expects the battery unit to generate more than ¥100 billion ($637 million) in annual revenue by fiscal 2030.

The Sakai site is the former Sharp LCD panel factory that SoftBank acquired for ¥100 billion ($676 million) in March last year. SoftBank is already converting the 440,000-square-meter complex into an AI data center with an initial capacity of around 150 megawatts, expandable to over 400 megawatts.…