LG Electronics completes $453.3m stake sale to create JV with Magna

This image, provided by LG Electronics on Dec. 23, 2020, shows a concept for a future vehicle using parts from LG and Magna International. The two sides agreed to set up a joint venture to make auto parts, including e-motors and inverters. (Magna International)

LG Electronics has completed the sale of a 49 percent stake in its electric vehicle part splitoff for $453.3 million to create a joint venture with Magna International‘s Austrian arm, a filing showed Wednesday.

As a result, the new entity LG Magna e-Powertrain will become a 51:49 joint venture of Seoul-based LG Electronics and Magna Metalforming, the Austrian affiliate of Canada-based vehicle engineering firm Magna International.

The news comes seven months after the two companies entered into a joint venture agreement in December to expand in electric powertrain market and establish a business dedicated to electric motors, inverters, onboard chargers and electric drive systems.

LG Electronics earlier in July split off its battery parts operations dedicated to power electronics and battery heaters for electric vehicles, before drawing Magna’s investment into the new entity.

LG Magna e-Powertrain will be based in Incheon and will have presence in Michigan and Nanjing, China. The company named Cheong Won-suk, who formerly led the electric vehicle powertrain business at LG Electronics vehicle components solutions, as its chief.

By Son Ji-hyoung(consnow@heraldcorp.com)