Samsung SDI plans $1.4 billion rights issue to fund growth
The company said it plans to use the funds to invest in its JV with GM in the US, boost capacity at its battery plant in Hungary and build lines for all solid-state batteries in South Korea.
Samsung SDI will issue new shares worth 2 trillion won (around USD 1.4 billion) to fund facility and R&D investments in an attempt to stay ahead of the competition.
The South Korean lithium-ion battery maker announced in a regulatory filing that it will sell 11,821,000 new shares to its employee stock ownership association with 20% allocation and other existing shareholders for the remaining to raise the amount.
The new share issuance amounts to a 16.8% capital increase.
The company said it plans to use the funds to invest in its joint venture with General Motors in the US, enhance capacity at its battery plant in Hungary and build lines for all solid-state batteries in South Korea.
“We decided to go forward with a rights issue to accelerate our mid- to long-term growth with a stable financial structure,” Samsung SDi’s CEO Joo Sun Choi said. “We will overcome the current market slowdown by strengthening our technological competitiveness, expanding sales and orders and innovating the cost structure, and prepare for the upcoming supercycle.”
Samsung SDI’s annual capital expenditure has risen from KRW 1.7trn in 2019 to KRW6.6trn in 2024, a nearly four-fold increase. The figure is expected to dip slightly this year as the company adjusts its investment plans to take into account the temporary slowdown in demand growth.
