LG Chem, Ltd shareholders have given the go-ahead to the company’s management to spin-off its battery business into a new entity, Reuters reported Friday (Seoul Time).
What Happened: The new unit, to be launched on Dec. 1, will be called LG Energy Solutions and would be a wholly-owned subsidiary, according to Reuters.
The Tesla Inc TSLA-supplier can now reportedly take its battery business public to fuel its expansion.
A source told Reuters that more than 82% of the shareholders who attended the meeting voted in favor of spinning-off the battery business.
Why It Matters: Up to 30% of the new company’s shares may be listed in an initial public offering in nearly a year’s time, Reuters reported.
LG Chem’s CEO Hak Cheol Shin said this month that the battery maker was in talks with a “couple” of automobile manufacturers to set up joint ventures.
The company already has JVs with General Motors Company GM and Geely Automobile Holdings Limited GELYF.
The South Korean company, in which the Elon Musk-led Tesla is said to be eyeing a stake, is also a major battery supplier to General Motors and Ford Motor Company F.
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