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EV battery maker LG Energy Solution's IPO breaks record

By Kim Ji-won & Kim Tae-gyu, UPI News Korea
EV battery maker LG Energy Solution's IPO breaks record
LG Energy Solution CEO Kwon Young-soo (C) poses with other company executives during an online press conference on January 10 ahead of the EV battery maker’s initial public offering on Thursday. Photo courtesy of LG Energy Solution

SEOUL, Jan. 24 (UPI) -- South Korean electric vehicle battery marker LG Energy Solution has broken the initial public offerings record in the country's stock market.

The Seoul-based company attracted $96.6 billion in deposits from about 4.4 million retail investors last week, shattering an 8-month-old record set by SK IE Technology with $68 billion last May.

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Earlier this month, almost 2,000 institutional investors placed bids for LG Energy Solution, amounting to $13 trillion in total. It marks the first time that the total bid amount has topped $10 trillion.

The high competition led to the IPO to be priced at $252 per share, the top end of the proposed range. As a result, LG Energy Solution is set to raise $11 billion Thursday, the country's biggest listing.

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In addition, the company's market valuation is to start at $59 billion, making it the No. 3 corporation on the Seoul bourse, following Samsung Electronics and SK hynix.

Experts expect that the market value of the company will surpass $72.4 billion, SK hynix's current value as of Monday. It is the world's second-largest memory chip manufacturer.

"CATL has become the world's largest EV battery maker, but that is largely thanks to the support of the Chinese government. When it comes to technology, I think LG Energy Solution is far more advanced. That's why U.S. and European carmakers are opting for LG Energy Solution instead of CATL," Daelim University automotive Professor Kim Pil-soo told UPI News Korea.

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"Hence, it does not make sense that CATL's market capitalization is larger than $200 billion and that LG Energy Solution's is just $59 billion. The difference will be narrowed," he said.

During the first 11 months of last year, CATL accounted for 32 percent of the global market, followed by LG Energy Solution, which took up 21 percent, according to South Korean business tracker SNE Research.

LG Energy Solution CEO Kwon Young-soo said the company will overtake CATL, taking into consideration its high cumulative order backlog of about $215 billion.

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"We will catch up with CATL. The gap in the market capitalization between the two companies will shrink. To be certain, I see opportunities," Kwon said during an online press conference on Jan. 10.

Local and global brokerages formed a syndicate to underwrite the IPO of LG Energy Solution. Included in the list are KB Securities, Morgan Stanley and Shinhan Investment Corp.

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