According to foreign media reports, on March 14, Samsung SDI, a battery and electronic materials manufacturer, said it will raise 2 trillion won (US$1.4 billion) by selling new shares to provide financial support for its battery facilities in the United States and Europe and the research and development of new technologies. Currently, Samsung SDI is betting on the long-term development prospects of the electric vehicle industry.
The share sale will increase the total issued shares of Samsung SDI by 16.8%, according to a regulatory filing and an email statement. The new shares are expected to sell at 169,200 won per share, 17% lower than the stock’s closing price on March 13.
The company will use the funds from the issuance of new shares to use battery manufacturing facilities jointly operated with General Motors and increase production capacity at its Hungarian plant, the statement said. The statement also added that Samsung SDI will also invest in the construction of assembly lines for the production of all-solid-state batteries in South Korea.
It is reported that the equity registration date for the allocation of new shares is set to April 18, and the final issue price will be determined on May 22. The subscription process will take place between May 27 and June 3, first for the Employee Stock Ownership Association and existing shareholders, and then the general public. New stocks are expected to be listed on June 19.
Given the growing prospects of the medium- and long-term growth of the battery market, it will take two to three years from investment in new facilities to achieving mass production, the company decided to conduct the latest share allotment plan.
Automakers around the world will stick to electrification strategies in the medium and long term despite concerns that slower growth in the electric vehicle market will lead to a decline in battery demand. Market researchers predict that the global battery market will grow by an average of 20% per year from 2025 to 2030.
Against this backdrop, Joo Sun Choi, CEO and President of Samsung SDI, said: “We have decided to make a share allocation to drive medium- and long-term growth with a stable financial structure. We will overcome the current market slowdown by enhancing technological competitiveness, expanding sales and orders, and cost structure innovations and prepare for the upcoming supercycle.”
It is reported that Samsung SDI will “actively promote” the research and development of new technologies such as lithium iron phosphate batteries and will maintain investment plans with General Motors and Stellantis.