Seoul, April 1 LG Energy Solution Ltd (LGES), South Korea's leading battery maker, said on Tuesday it will acquire General Motors' entire stake in their joint venture (JV) battery plant in the state of Michigan in the US for 3 trillion won ($2.04 billion).
The planned acquisition of the Ultium Cells JV 3 plant in Lansing, Michigan, is aimed at minimising the burden of fresh investments in facilities and "effectively" operating its U.S. plants, the company said in a text message, reports Yonhap news agency.
The two companies have been building the 50:50 JV plant in Michigan with an aim to begin operations within this year. "The company doesn't need fresh funds to finance the acquisition as the acquisition money was already factored in the annual capital expenditure plan announced early this year," the message said.
Earlier this year, LGES said it will reduce its facility investments by 20 to 30 percent for the year compared with 13 trillion won in 2023.
In December, GM announced its plan to sell its stake in the Lansing plant to LGES as it adjusts its electric vehicle (EV) plans amid a slowdown in EV sales.
The Ultium Cells LLC JV between LGES and GM currently operates its No. 1 plant in Ohio and No. 2 plant in Tennessee.
Meanwhile, LG Chem Ltd., South Korea's leading chemical firm, said in February it shifted to a net loss in the fourth quarter from a year earlier due to lower demand for petrochemical and battery materials products. LG Chem swung to a net loss of 899.2 billion won (US$613.3 million) in the three months ended in December from a net profit of 128.5 billion won a year ago, the company said in a regulatory filing.
LG Chem has an 81.84 per cent stake in LG Energy Solution Ltd., the country's leading battery maker. The company also shifted to an operating loss of 252 billion won in the December quarter from an operating profit of 247.4 billion won a year ago.
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