LGES¡¯ IPO overwhelmed with $8.4 trillion institutional bids to eye top-end pricing

[Source: LG Energy Solution Ltd.]

LG Energy Solution Ltd. set to open a new chapter in Korean IPO history has been awash with $8.4 trillion institutional funding during book-building session that would comfortably price initial shares at the top end of 300,000 won ($252) for a near $11 billion IPO.

Korea¡¯s pure-play battery maker separated from LG Chem with ambition to become the world's No. 1 power behind electric vehicles through enhanced ammunition from the Kospi listing drew oversubscription by 1,700 times in institutional booking on Tuesday, the first day of a two-day session.

Pricing results will be announced on Friday.

Shares of LG Chem lost 2.3 percent to close at 755,000 won on Thursday.

Given the unmatchable heat, LG Energy Solution's IPO will comfortably raise 12.7 trillion won to place the stock at No. 3 on Kospi after chip majors Samsung Electronics and SK hynix, with market cap of 70.02 trillion won upon listing on Jan. 27.

Approximately 80 percent of institutional bidders signed up for the lock-up period to promise to hold IPO shares for at least 15 days to 6 months, according to syndicate bank sources.

Responses from overseas investors reportedly have been equally overwhelming.

Public subscription session for individual investors is scheduled on Jan 18-19. Underwriters are securities firms KB, Daishin, Mirae Asset, Shinyoung, and HI, plus Shinhan and Hana financial investment companies. Only a single subscription is allowed per investor.

LG Energy Solution is vowing fast upgrade in production mix as well as capacity expansion across the globe to cement its leadership upon going public.

The world's second largest EV battery supplier launched a project to adopt the z-holding technology – the zigzag stacking of battery cells - to move beyond its traditional self-developed lamination and stacking method.

A senior LG Energy Solution official, who asked to be unnamed, confirmed that the company is reviewing the plan of employing z-folding method that takes longer time to produce batteries but enhances output. The company is expected to make mixed use with lamination and staking method.

Earlier on Jan. 10, LG Energy Solution CEO Kwon Young-soo at a news conference had mentioned the company is developing a new battery stacking technology.

R&D center at its affiliate LG Electronics, which has been working together with LG Energy Solution on battery technology advancement, recently added ¡°z-stacking¡± team.

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