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LG Chem will split its battery business

Christian Fernsby ▼ | September 17, 2020
South Korea’s LG Chem, an electric car battery supplier for Tesla Inc and GM said on Thursday it plans to separate its battery business into a new company as the electric vehicle market takes off.
LG Chem
Batteries   LG Chem
Accordingly, LG Chem plans to receive approval from the extraordinary meeting of stockholders on October 30 and officially launch ‘LG Energy Solution (tentative)’ as a new corporation exclusively in charge of the battery business from December 1.

Topics: LG Chem

This will be a physical division in which LG Chem will possess all of the stocks issued by the new battery corporation and LG Chem will possess 100% of the non-listed shares of the new corporation.

LG Chem plans to foster the new corporation to achieve sales of over 30 trillion KRW in 2024 and become the world’s best energy solutions company based on batteries. The expected revenue of the new corporation is around 13 trillion KRW this year.

Regarding the IPO (initial public offering) of the new corporation, it stated that “Nothing is confirmed as of now and we plan to continuously review it in the future.”

It added, “Cash generated from business activities will be used as the facility investment funds according to the increase of EV demands and since LG Chem possesses 100% of the shares, it will be possible to procure the funds using various methods.”

LG Chem plans to foster the new corporation to become the world’s best energy solutions company for not only battery materials, cells, pack manufacturing and sales, but also to have distinguished competitiveness in the E-platform sector that offers various services throughout the lifetime of batteries such as battery care/lease/charging/reuse.