Last Friday, Korean traction battery maker LG Energy Solution confirmed its intention to raise $10.8 billion through a public offering at a Seoul site by the end of January. This will be the largest IPO in South Korea’s history, and the proceeds from the IPO will help the company solidify its position as the world’s second-largest lithium battery supplier.
How remembered Nikkei Asian ReviewAccording to the results of three quarters of 2021, LG Energy Solution controlled 23.8% of the global traction battery market, second only to China’s CATL with 31.2% of the market but ahead of Panasonic with 13.3%. On Friday, LG Energy Solution confirmed that it intends to launch an IPO in South Korea before the end of the month, hoping to raise $10.8 billion by selling 42.5 million shares. The move will increase the company’s capitalization to nearly $59 billion and make it the third-largest issuer in Korea’s Kospi Index. It is only surpassed by Samsung Electronics and SK Hynix.
Parent company LG Chem intends to sell 8.5 million shares of LG Energy Solution in the course of the share offering. General Manager Kwon Young-soo thanked the investors who were positive about the company’s future growth potential. The number of IPO subscribers reached 1988, including foreign and Korean investors.
Obviously, the bulk of the proceeds will go to developing the U.S. market, as LG Energy Solution will spend at least $4.7 billion building local businesses, for comparison, the company is willing to spend no more than $542 allocate millions for the development of production in South Korea, Europe will receive $1.2 billion, China can claim about $1 billion in investments. In addition to General Motors, Stellantis in the USA is showing interest in the production of traction batteries for electric vehicles together with LG Energy Solution. The Chevrolet Bolt EV battery scandal hasn’t stopped GM from committing more than $2.3 billion to building a new facility in Tennessee that will make LG Energy Solution batteries.