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Halla invests $85 mil in battery separator maker WCP Korean auto parts supplier seeks to expand EV battery materials business

Translated by Kim So-in 공개 2021-09-24 08:09:56

이 기사는 2021년 09월 24일 08:07 더벨 유료페이지에 표출된 기사입니다.

South Korea’s auto parts supplier Halla Holdings has made a strategic investment in electric vehicle (EV) battery separator manufacturer W-Scope Chungju Plant (WCP).

Halla Holdings, Halla Group’s holding company, said on September 16 that it recently invested 100 billion won ($85 million) in WCP through its subsidiary Weco. The company invested 100 billion won in a private equity (PE) fund created by PE firm Noh & Partners, with the fund purchasing a stake in WCP.

“We made the investment in the fund through the wholly-owned subsidiary Weco because a holding company is not allowed to directly invest in a fund under the Fair Trade Act,” said an official at Halla Group. Halla Holdings has two wholly-owned subsidiaries, including Weco, a suspension products manufacturer, and JJ Halla, a real estate developer.

A stake in WCP, which Weco has purchased through the fund, is understood to have formerly owned by Noh & Partners. Noh & Partners purchased convertible bonds issued by WCP in 2019 and converted them into common shares and sold them to Weco through the fund in the latest deal. WCP is a wholly-owned subsidiary of Japan’s W-Scope.

WCP produces lithium-ion battery separators for EVs. It has a head office and factory in Chungju, North Chungcheong Province. The company is leading the global EV battery separator market along with SK IE Technology and Japan’s Asahi Kasei. It mainly supplies to Samsung SDI and LG Energy Solution and is seeking to go public in the first half of next year.

Market experts said that Halla Group seeks to expand its EV parts and materials business through the latest investment in WCP. “We plan to cooperate in various forms, including the establishment of a joint sales network,” said an official at the company, declining to reveal a clear purpose for the investment.

Some said that the company may try to purchase management rights later considering that Halla Group is actively expanding its future car-related parts and materials business, such as EVs, hydrogen cars, and autonomous vehicles amid high growth potential of EV battery market.

“It is true that we made a strategic investment worth 100 billion won, but the stake in WCP that we will hold is not large,” said the official at the company, adding, “I think it is too early to think about a potential purchase of an additional stake or management rights.”

Halla Group is expected to own around 5% of WCP given that the current valuation of the company is reportedly around 2.5 trillion won.

Mando, part of Halla Group, recently split off its advanced driver assistance system division and part of its mobility business to create a new subsidiary, tentatively called Mando Mobility Solutions. (Reporting by Doung Yang)
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