September 21, 2023: LG Energy Solution has raised $1bn through its first global green bond issue which will be invested in its global battery production facilities.
The South Korea-based manufacturer said on September 19 proceeds derived from the issue will support corporate environmental responsibilities and R&D that contributes to sustainable development.
LGES said the issue comprises a $400 million three-year bond and a $600 million five-year bond.
The three-year bond was issued at 100 basis points above the yield of US three-year treasury notes, with the five-year at 130 basis points above the yield of US five-year treasuries.
The company said it attracted orders from 114 institutional investors on its three-year bond and 186 on its five-year bond, with the total order reaching five times the issuance size.
As of last June, LGES said its overall total order backlog amounted to KRW440 trillion ($331 billion) as of June 2023.
In April, South Korea’s government launched a multibillion dollar program to defend and expand its battery industry amid fears lucrative US tax breaks and incentives are tipping the global battery trade balance stateside.
The government later designated one of the country’s key industrial sites to fast track investment to develop a secondary battery enterprise zone.
In July, LGES and Stellantis resumed construction of their NextStar Energy EV battery plant in Canada under a deal worth up to C$15 billion ($11.4 billion) in tax breaks for the project.