LG Energy Solution’s intellectual properties and diversity in the foreign client pool could push it ahead of its battery making rival Contemporary Amperex Technology (CATL), according to the South Korean company.
LG— the battery division of LG Chem— believes it can usurp its Chinese rival and become the world’s top electric vehicle (EV) battery maker, its CEO Kwon Young-soo said during an online press conference, as reported by South Korean media firm Yonhap News Agency.
Kwon is reported as saying LG overwhelms the CATL in IPs and has more diverse clients in US and Europe, along with production bases in those locations to supply products to clients.
Kwon is quoted as saying: “I believe that the backdrop to CATL’s growth is that Chinese automakers have preferred locally produced batteries, or the policy to use them.
“Since we have more orders, we predict that we will be higher than CATL in terms of market share in the future.”
According to industry analysts VC Elements, LG is the second biggest battery maker with around 25% market share, compared to CATL, which has a 32% market share.
Japan’s Panasonic is third (14%) and China’s BYD is in fourth (7%) in the table of leading battery makers.
LG Energy Solution supplies batteries to Tesla, Hyundai Motor and General Motors.
Kwon reportedly hinted that any new battery plant in Europe would be announced as a joint venture deal with an automaker outside of Poland.
LG Energy Solution also plans to expand its EV battery portfolio to lithium iron phosphate batteries (LFP).
Raising Capital
LG Energy Solution is planning to raise $11billion from an initial public offering to take on CATL, which has a market cap of $196 billion, as of this month.
LG Energy will offer 34 million new shares in a range of up to Won300,000 ($251) a share to give it a market cap of around Won70.2 trillion ($59 billion), which would make it South Korea’s third-most valuable company after Samsung Electronics and SK Hynix.
The initial public offering (IPO) on the main KOSPI market, is expected to raise as much as 12.75 trillion won.
With IPO proceeds, LG Energy Solution said in regulatory documents it plans to spend 8.84 trillion won to boost its domestic and overseas production, including 5.6 trillion won for its Holland plant in Michigan, the United States, and 1.4 trillion won for the Wroclaw plant in Poland.
