By Scott Murdoch and Heekyong Yang
SYDNEY/SEOUL – South Korean battery maker LG Energy Solution (LGES) raised $10.8 billion in its initial public offering (IPO), attracting record demand for a deal in South Korea, the company said on Friday.
LGES shares were priced at 300,000 won each, at the top of a range announced in a regulatory filing last month, raising 12.8 trillion won ($10.76 billion). [nL1N2SS0GL]
The listing, set to take place on Jan. 27, will be the biggest in the country after Samsung Life Insurance Co Ltd’s 4.8 trillion won IPO in 2010.
The pricing values LGES at 70.2 trillion won, making it South Korea’s third most-valuable company after Samsung Electronics Co Ltd and SK Hynix Inc.
LGES, LG Chem Ltd’s battery subsidiary, supplies Tesla Inc, General Motor Co and Volkswagen AG, among other automakers.
A total of 1,988 domestic and foreign institutional investors placed bids, LGES‘ filing showed, valuing total bids at record $12.8 trillion.
LGES said the institutional book for the IPO was 2,023 times covered – the largest ever for an IPO in South Korea.
LGES expects to offer 34 million new shares in the IPO and parent LG Chem plans to offer 8.5 million existing shares.
The parent company will own 81.8% of LGES after the listing.
The IPO comes as global battery-powered electric vehicle (EV) sales, estimated at 2.5 million units in 2020, are forecast to grow more than 12-fold to 31.1 million by 2030 and account for nearly a third of new vehicle sales, according to consulting firm Deloitte.
Analysts said they are closely watching LGES‘ IPO and how its stock trades later this month to gauge the health of the 2022 IPO market.
South Korea saw its hottest IPO market on record last year. More than 20 companies went public on the main KOSPI market, raising about 17 trillion won, beating the previous record of 8.8 trillion won raised in 2010, according to the Korea Exchange.