LG Chem promises $ 9 billion in investment by 2025, offers 20-30% stake in battery unit this year

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South Korean company LG Chem Ltd. will invest 10,000 billion won ($ 8.7 billion) by 2025 to move away from traditional chemicals to environmentally friendly materials with a specialty in battery supply and could offer 20 30% stake in the merged battery maker LG Energy Solution Ltd. during this year.

“The revolution in our company to change our identity to a science and technology company has started and the results will appear from the second half,” LG Chem CEO Shin Hak-cheol said at his online press conference. Wednesday. “We are reviewing more than 30 projects related to mergers and acquisitions, joint ventures and strategic investments to strengthen cooperation with other companies,” he said.

LG Chem stock closed at 844,000 won on Wednesday, up 0.48% from the previous session.

The company plans to invest 6 trillion won by 2025 in the battery materials sector and expand its product portfolio to include cathodes, anodes, separators, cathode binders, heat-resistant glue. heat and carbon nanotubes (CNT).

It will launch the construction of a new anode plant with a capacity of 60,000 tonnes per year in Gumi in December to increase its total anode production capacity by seven, from 40,000 tonnes last year to 260. 000 tonnes by 2026.

Shin said the company is considering a plan to establish a joint venture with a mining company to ensure a stable supply of anode materials.

In order to expand the production of battery separators, the company is considering acquiring or partnering with a company that has the necessary technology or market value. It will also establish an overseas manufacturing plant.

“The supply structure will continue to be LG Energy Solution-centric, but we are looking for various strategies to diversify our supply channel,” Shin said. “The global battery market, where no company has more than 40% market share, has great potential, so we will continue to work hard to maintain sustainable growth. ”

LG Chem’s CNT factory in Gumi. [Photo by LG Chem Ltd.]

LG Chem plans to triple its CNT manufacturing capacity by 2025, up from 1,700 tonnes this year. It built its second CNT plant with an annual capacity of 1,200 tonnes in April and will begin construction of the third plant by the end of the year.

It will invest 60 percent of the total 10,000 billion won investment in domestic enterprises, including construction of the Gumi plant, and 3 trillion won in green enterprises such as biomaterials, recycling and renewable energies.

About 1,000 billion won will go to biopharmaceutical companies. It aims to develop more than two new drugs by 2030 and bring them to advanced markets in the United States or Europe.

The number of drugs in the clinical phase will increase to 17 by 2025 compared to 11 currently.

Its LG Energy Solution battery production unit could go public this year, Shin said. The battery maker parted ways with LG Chem in December and filed an initial public offering (IPO) last month to debut in the Kospi market. LG Chem will continue to hold a controlling stake of around 70-80% in LG Energy Solution after the IPO, he said.

By Won Ho-sup, Choi Keun-do and Choi Mira

[ⓒ Pulse by Maeil Business News Korea & mk.co.kr, All rights reserved]


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