LG Energy Solution raises $1 billion with first global green bond

Interest extremely high with five times more bids than base issue

LG Energy Solution (LGES) will be accelerating its already rapid expansion after the South Korean battery producer raised $1 billion through its first global so-called green bond issue.

Interest was high with the bonds priced 40 basis points below LGES’s forecast after the firm received bids nearly five times the size of the base issue, the Korean Herald reports. Last year LGES invested more than $4.5 billion in battery production and is targeting a 50% jump in outlays for battery production projects this year.

Apart from an ongoing expansion in its home country, LGES is building a $5.5 billion 27 GWh battery complex in Arizona for the electric car market that the company aims to bring into commercial production in 2025. LGES is also building a smaller separate plant to manufacture lithium-iron-phosphate (LFP) batteries destined for stationary energy storage system (ESS) customers. The ESS plant will go into production in 2026.

In Canada, LGES has teamed up with Stellantis for a new plant in Windsor, Ontario, which would be the first of its kind in the country. The maker of Fiat, Chrysler and Jeep vehicles and LGES are investing a combined $4 billion in the venture and batteries could start exiting factory gates as soon as the first quarter of next year. Chrysler has been building cars in Windsor since 1925.

The Adamas Intelligence EV Battery Capacity and Battery Metals Tracker, which tracks and analyzes the battery capacity in newly-sold EVs in more than 100 countries, shows LGES supplied over 30 automakers in the first half of 2023, including Volkswagen, Volvo and unsurprisingly Hyundai.

And its batteries can be found in 105 models including the world’s number one selling EV, the Tesla Model Y (those sold outside the Americas), Audi Q4 e-tron, Polestar 2, Chevrolet Bolt, Ford Mustang Mach-E and the Porsche Taycan.

The global market share of LGES among battery manufacturers is 19% according to Adamas year-to-date data making it the world’s number two after China’s CATL and ahead of battery and automaker BYD.

LGES has delivered nearly 70 GWh of battery power during the first seven months of the year, already three-quarters of what the company supplied in all of 2022. Generally EV sales speed up towards the end of the year and December is always a bumper month – 2023 should see LGES easily smash another company growth record.