LG Energy Solution raises 1 trillion KRW in corporate bonds with interest rates fixed at 4.097% to 4.298%

Seed money used for raw material purchase and JV... Full amount issued as green bonds

LG Energy Solution is raising 1 trillion KRW through its first corporate bond issuance since its launch. The interest rates for the bonds have been set at 4.097% per annum for the 2-year bonds, 4.196% per annum for the 3-year bonds, and 4.298% per annum for the 5-year bonds, as announced on the 28th.

Despite unfavorable market conditions such as economic downturn and interest rate hikes, the company explained that the rates were set 11 to 20 basis points (1bp = 0.01 percentage points) lower than the AA-rated average market rates (private bond rating agency evaluation rates).

With demand forecasts attracting 4.72 trillion KRW, the final issuance amount was decided at 1 trillion KRW, double the initially registered amount of 500 billion KRW. For the 2-year bonds, 1.135 trillion KRW was raised against a target of 100 billion KRW; for the 3-year bonds, 1.74 trillion KRW against 200 billion KRW; and for the 5-year bonds, 1.845 trillion KRW against 200 billion KRW.

Of the 1 trillion KRW secured through the bond issuance, LG Energy Solution plans to use 100 billion KRW as operating funds for purchasing raw materials such as cathode materials, and 900 billion KRW as investment funds for joint ventures (JVs).

Previously, LG Energy Solution announced the establishment of North American joint ventures with automakers Stellantis, Honda, and Hyundai Motor Group. The bonds issued this time are green bonds, meaning all the funds raised must be used exclusively for eco-friendly related businesses.

This content was produced with the assistance of AI translation services.