On December 7, 2021, South Korean power battery giant LG Energy Solutions plans to raise approximately 12.8 trillion won (approximately 69.2 billion yuan) through an initial public offering (IPO) on the Korean Stock Exchange. This will become the largest IPO in South Korea's history, more than twice the size of Samsung Life's 4.9 trillion won (approximately US$4.2 billion) IPO in 2010.

As the strongest opponent of the Chinese power battery giant Ningde era, if the IPO goes well, the valuation of LG New Energy after listing is expected to reach 80 trillion won (approximately US$67.8 billion), gradually approaching the market value of the Ningde era. In addition, it is reported that LG New Energy has plans to seek a listing on the Nasdaq.

In the ranking of global power battery installed capacity in October recently announced by South Korean market research organization SNE Research, LG New Energy ranked second, second only to the Ningde era from China. In the first half of 2021, LG New Energy accounted for 24.8% of the global power battery market, and CATL had a market share of 30.1%.

As the world's second largest power battery manufacturer, LG New Energy's IPO road has not been smooth sailing.

As early as June 2021, LG New Energy submitted a listing application to the Korea Stock Exchange, and originally planned to complete the listing by the end of 2021. Two months later, the General Motors Bolt electric vehicle loaded with its batteries was recalled because of the risk of fire. The listing plan was forced to suspend. LG New Energy did not resume the IPO process until October 2021 after paying a huge compensation of US$1.9 billion to General Motors.

Affected by the GM battery turmoil, LG New Energy executives have also made personnel changes. LG Group Vice Chairman Quan Yingshou will replace Jin Zhong as the current CEO and will be responsible for the IPO after the restart. KB Securities and Morgan Stanley will serve as the lead underwriters for this IPO. Bank of America, Citigroup, Goldman Sachs, Daishin Securities and Shinhan Investment Group have also been named joint bookrunners.

The South Korean Stock Exchange disclosed last week that LG New Energy has now passed the preliminary review of its first IPO. According to the process, the company needs to submit corresponding documents to the Korean Financial Supervisory Authority within the next month, and the final listing time is expected to be at the end of January 2022.

Cui Shengdong, the head of LG New Energy Electric Vehicle Development Center, announced the company’s development plan in May 2021: LG New Energy plans to reach the "world's highest production capacity" of 260GWh by 2023, and achieve sales of US$270 billion by 2024, and become an electric vehicle. The first company in the field of automotive power batteries. In addition, the company also plans to commercialize lithium-sulfur batteries by the end of 2025, and commercialize all solid-state batteries between 2025 and 2027.

To achieve the above goals, LG New Energy continues to invest heavily in expansion and research and development. It plans to invest 15 trillion won (about 85 billion yuan) in the next 10 years to develop next-generation battery technology and consolidate its battery industry. leading position. Among them, 12.4 trillion won will be used for LG Energy Solutions to develop next-generation battery technology, ensure the production technology required for the establishment of smart factories, and increase production lines. The remaining 2.7 trillion won will be used by LG Chem to research and develop cutting-edge battery material technology and expand the production capacity of battery cathode materials.

In March 2021, LG New Energy announced plans to invest US$4.5 billion by 2025 to expand its battery production business and build new battery factories in the United States. In July 2021, LG New Energy and Hyundai Motor Group jointly invested US$1.1 billion to establish an electric vehicle battery plant in Indonesia.

LG New Energy and Ningde era took the lead, and the momentum is very strong. In addition to the earlier European and American markets, LG New Energy is also increasing its expansion in the Chinese market. Following the investment of USD 500 million to produce power batteries in Nanjing Economic Development Zone in 2020, LG New Energy will build a second power battery plant in Nanjing Binjiang Development Zone with a total investment of approximately USD 1.3 billion in the first half of 2021. The annual production capacity will be fully completed. Will reach 24GWh. At present, LG New Energy's production bases have spread all over the world, such as Ocang in South Korea, Michigan in the United States, Nanjing in China, and Wroclaw in Poland. Editor/Sang Xiaomei