LG Energy Solution Raises $10.8 Billion in South Korea's Biggest IPO

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 KRW 300,000  each, at the top of a range announced in a regulatory filing last month, raising KRW 12.8 trillion.

The listing, set to take place on January 27, will be the biggest in the country after Samsung Life's KRW 4.8 trillion IPO in 2010.

The pricing values LGES at KRW 70.2 trillion, making it South Korea's third most-valuable company after Samsung Electronics and SK Hynix.

GES, LG Chem's battery subsidiary, supplies Tesla, General Motor, 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 percent 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. © Reuters

January 14, 2022