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LS Cable & System to Grow Electric Vehicle Parts Business
Focusing on Aluminum Components
LS Cable & System to Grow Electric Vehicle Parts Business
  • By Jung Min-hee
  • March 7, 2019, 08:55
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Aluminum products manufactured by LS Alsco

LS Cable & System Ltd. is selling a stake in its subsidiary with the aim of securing capital to expand its electric vehicle (EV) parts business.

The company announced on March 6 that it will sell a 49 percent stake in its subsidiary LS Alsco to local private equity fund (PEF) Keistone Partners Co. for 30.90 billion won (US$27.37 million). It will retain a 51 percent stake in LS Alsco after the sale, maintaining its managerial control.

LS Cable & System is seeking to raise capital by selling the stake in LS Alsco in order to launch a new aluminum component business for EV batteries. LS Alsco was established in September last year by LS Cable & System to specialize in the aluminum business. LS Alsco will expand its business into frames for EV batteries and aluminum materials for EV parts.

“We expect that aluminum will be a key material for EV parts in the future as light weight is a key issue in the EV market,” said a spokesperson of LS Cable & System. In particular, LS Cable & System is planning to list LS Alsco on the stock market in a few years after ensuring the company’s internal stability based on the funds secured through the stake sale. Keistone Partners is expected to start recovering funds after the listing.

Meanwhile, LS Cable & System is fostering its EV parts business as a new growth engine by running EV battery component plants in South Korea, Poland and China, in addition to LS Alsco, which is entering the EV parts market. LS EVP in Poland is supplying EV battery pack parts for 300,000 units a year to European EV producers, while LS CW in China is targeting the Chinese EV market.