By Kim Yoo-chul
Samsung Group is accelerating its effort to claim the lion's share of the battery business, which the conglomerate has identified as its next cash cow, with its battery affiliate acquiring the cell materials division of the group's chemical affiliate.
On Friday, Samsung SDI said it will buy the division from Samsung Fine Chemicals (SFC) for 18.7 billion won, Sept. 16.
With the move, it will acquire all equipment for research projects in battery materials, patents, related staff and a 58 percent stake of STM. STM is an affiliate of Samsung Fine Chemicals established in 2011 with Japan's Toda Kogyo.
The takeover will help Samsung SDI have a vertically integrated structure in its battery business.
"The takeover decision was a part of Samsung's strategy to boost the corporate ability of handling materials, which we believe is a crucial factor in the functionality of batteries amid increasing demand for electric vehicles," spokesman Seo Hae-su said.
As part of the deal, SDI also decided to hand over its entire 29.2 percent stake in Samsung BP Chemicals, worth 81.9 billion won, to SFC.
"Money that will be earned from the swap deal will be used for investment in large-sized batteries for electric vehicles," Seo said. SFC said it will focus on boosting its premium fine chemicals-related businesses after the deal.
"Samsung Fine Chemicals plans to team up with global leaders in the chemical industry. If necessary, the company will strike mergers and acquisitions for further external growth," an SFC spokesman said.
SDI acquired the battery pack business division of Magna earlier to launch Samsung SDI battery systems. The group's battery-making unit recently established a joint venture in China and is building a factory in the city of Xi'an with an annual capacity of more than 40,000.
SDI competes with local rival LG Chem. LG is currently a global leader in large-sized batteries in terms of the number of secured clients and car battery orders, which are estimated to be worth some 10 trillion won. Thanks to an exclusive partnership with BMW of Germany, SDI is on track to close the gap.
Most of Samsung SDI's annual profits and sales are in sync with the performance of SDI's top client Samsung Electronics, with the latter purchasing small-sized batteries for use in the Galaxy line of mobile devices.
SFC will also sell its research centers in Suwon, where Samsung's technology compounds are located, to Samsung Electronics for 95.3 billion won.
Earlier, Samsung unloaded its chemical and defense affiliates to Hanwha Group for more than 2 trillion won to put more focus on promising businesses.
Samsung Group is accelerating its effort to claim the lion's share of the battery business, which the conglomerate has identified as its next cash cow, with its battery affiliate acquiring the cell materials division of the group's chemical affiliate.
On Friday, Samsung SDI said it will buy the division from Samsung Fine Chemicals (SFC) for 18.7 billion won, Sept. 16.
With the move, it will acquire all equipment for research projects in battery materials, patents, related staff and a 58 percent stake of STM. STM is an affiliate of Samsung Fine Chemicals established in 2011 with Japan's Toda Kogyo.
The takeover will help Samsung SDI have a vertically integrated structure in its battery business.
"The takeover decision was a part of Samsung's strategy to boost the corporate ability of handling materials, which we believe is a crucial factor in the functionality of batteries amid increasing demand for electric vehicles," spokesman Seo Hae-su said.
As part of the deal, SDI also decided to hand over its entire 29.2 percent stake in Samsung BP Chemicals, worth 81.9 billion won, to SFC.
"Money that will be earned from the swap deal will be used for investment in large-sized batteries for electric vehicles," Seo said. SFC said it will focus on boosting its premium fine chemicals-related businesses after the deal.
"Samsung Fine Chemicals plans to team up with global leaders in the chemical industry. If necessary, the company will strike mergers and acquisitions for further external growth," an SFC spokesman said.
SDI acquired the battery pack business division of Magna earlier to launch Samsung SDI battery systems. The group's battery-making unit recently established a joint venture in China and is building a factory in the city of Xi'an with an annual capacity of more than 40,000.
SDI competes with local rival LG Chem. LG is currently a global leader in large-sized batteries in terms of the number of secured clients and car battery orders, which are estimated to be worth some 10 trillion won. Thanks to an exclusive partnership with BMW of Germany, SDI is on track to close the gap.
Most of Samsung SDI's annual profits and sales are in sync with the performance of SDI's top client Samsung Electronics, with the latter purchasing small-sized batteries for use in the Galaxy line of mobile devices.
SFC will also sell its research centers in Suwon, where Samsung's technology compounds are located, to Samsung Electronics for 95.3 billion won.
Earlier, Samsung unloaded its chemical and defense affiliates to Hanwha Group for more than 2 trillion won to put more focus on promising businesses.
