Tesla Battery Supplier LG Energy Eyes $11B IPO: What You Need to Know

South Korea's LG Energy Solutions, which supplies EV batteries to the likes of Tesla, Inc. TSLA, Ford Motor Company FM and Volkswagen AG VWAGY, is reportedly gearing up for a massive initial public offering.

What Happened: LG Energy is planning to offer 34 million shares at an estimated price range of 257,000 Won to 300,000 Won ($214 to $250), the Financial Times reports.

The company is now a wholly-owned subsidiary of South Korean chemical company LG Chem.

At the high-end of the estimated price range, LG Energy is valued at 70.2 trillion Won ($58.5 billion), which would make it the third most-valued South Korean company after Samsung Electronics and SK Hynix, the report added.

Trading of the company's shares will likely begin on Jan. 27, 2022.

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Why It's Important: LG Energy is the second-ranked global battery manufacturer after China's CATL. The South Korean company had a market share of 22% in the 11-months ending November 2021 compared to 29% for CATL, according to SNE Research.

The company is reportedly planning to invest 8.85 trillion Won ($7.3 billion) into its battery plants in South Korea, Poland, the U.S. and China by 2025 tripling its battery production capacity to 400 Giga-watt hours. The public listing is likely to provide the company the wherewithal to pursue its ambitious capacity expansion plan.

LG's nickel-based batteries are pricier than lithium-iron phosphate batteries manufactured by its Chinese rivals.

The company also faces headline risks stemming from the recall of EVs from General Motors Corporation GM and Hyundai Motor Company HYMTF powered by its batteries.

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