Synopsis
Samsung SDI Co., South Korea's second-largest battery manufacturer, plans to raise 2 trillion won ($1.37 billion) through a stock offering as part of its growth strategy. The funds will be used for joint ventures and production enhancements.Key Takeaways
- Samsung SDI to raise 2 trillion won ($1.37 billion)
- Funds allocated for joint ventures and production in the U.S. and Hungary
- Investment in solid-state battery facilities in Korea
- Exploring financing options to bridge EV gap
- Annual growth of 20% expected in car battery market
Seoul, March 15 (NationPress) Samsung SDI Co., the second-largest battery producer in South Korea, announced its plans to generate 2 trillion won (approximately $1.37 billion) through a stock issuance as part of its comprehensive growth strategy.
The company's board has sanctioned this increase in capital, which aims to proactively secure funds to brace for a recovery in the automotive battery sector, as stated in a press release.
According to Samsung SDI, around 11.82 million common shares will be offered at a price of 169,200 won each, with the final share price to be determined on May 22, as reported by Yonhap news agency.
The shares will first be available to existing shareholders, with their listing slated for June 19 after subscription phases from May 27 to June 3, the company indicated.
The funds raised will be directed towards investing in a joint venture with General Motors Co. in the U.S., enhancing production capabilities at its Hungarian facility, and allocating resources for its solid-state battery manufacturing in Korea.
Additionally, the company plans to explore various financing alternatives, including leveraging its current assets, to bridge the electric vehicle (EV) gap, which occurs prior to the mass adoption of EVs.
Despite the EV gap, Samsung SDI's investment in facilities surged to 6.6 trillion won last year, up from 1.7 trillion won in 2019.
Global market research firms predict an annual growth rate of 20 percent in the automotive battery sector from 2025 to 2030, according to the release.
Moreover, Samsung SDI has entered into an initial agreement with Hyundai Motor and its subsidiary Kia to collaboratively develop batteries tailored for robots.
The company has signed a memorandum of understanding (MOU) with both automakers to create high-performance batteries specifically designed for robotic applications, aiming to significantly enhance energy density, output, and operational duration, as stated by the company.
“Through this collaboration, we will introduce unique technologies and premium products in the robot battery sector,” asserted Samsung SDI Executive Vice President Cho Han-jae.
