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26 Apr LG Chem, Korea Zinc to Launch EV Battery Material JV
LG Chem [051910:KS] and Korea Zinc [010130:KS] will establish a joint venture (JV) in May 2022 to produce precursors, a material crucial for cathode materials in electric vehicle (EV) batteries, as reported by The Korea Economic Daily on April 24. Korea Zinc will control 60% of the firm, with a KRW200bn (USD160m) capital stock, while LG Chem will own the remainder. As a result of this agreement, LG Chem is likely to secure materials supply, while Korea Zinc obtains the opportunity to break into the EV battery sector.
The partnership will help the two companies form a complete battery value chain. As part of the plan, Korea Zinc will provide nickel sulfate to the JV for the manufacturing of precursors, which are subsequently delivered to LG Chem for cathode production. LG Chem expects to raise its annual cathode material output to 260,000 tons by 2026, up from 80,000 tons last year. Notably, LG Chem is also looking for broad access to Indonesia’s abundant nickel reserves. Earlier this month, a South Korean consortium led by LG group [003550:KS], which includes LG Energy Solution [373220:KS], LG Chem, LX International [001120:KS], and POSCO [005490:KS], signed a USD9bn agreement with several Indonesian state-owned companies, including PT Aneka Tambang [ANTM:IJ] and Indonesia Battery Corporation, to establish an EV battery supply chain in Indonesia.