LG Energy Solution Ltd., a leading global battery manufacturer headquartered in Seoul, South Korea, is planning to issue green bonds to fund a variety of ESG initiatives. The company has mandated five banks (Bank of America Corp., Citigroup Inc., Morgan Stanley, Standard Chartered Plc and Korea Development Bank) to arrange a series of investor meetings to gauge demand for the bonds, which could be issued in three- and five-year maturities.

The green bonds could be used to fund a range of ESG initiatives, including:

• Investing in renewable energy projects
• Developing more efficient battery production processes
• Reducing waste and emissions
• Converting 100% of electric power used at its domestic and overseas business sites to renewable energy by 2030

The issuance of green bonds by LG Energy is a significant development in the ESG space. It is the first time that a major battery manufacturer has issued green bonds, and it signals the growing importance of ESG investing. The bonds are expected to be well-received by investors, as they offer a way to support companies that are committed to sustainability.

Related Article: LG Energy Solution Establishes First Battery Recycling Joint Venture with Huayou Recycling

LG Energy was incorporated in December 2020 after being split-off from LG Chem. LG Chem was last in the market with a dollar bond in July 2022, when it garnered orders for over $1 billion for a $300 million green bond sale.

The company is a major supplier of batteries to electric vehicles, and it has set ambitious goals to reduce its environmental impact. LG Energy plans to become carbon neutral by 2050.

The issuance of green bonds by LG Energy is a positive development for the ESG space. It is a sign that the company is committed to sustainability and is taking concrete steps to reduce its environmental impact. The bonds are also a sign of the growing momentum behind sustainable investing.

Sources: Reuters & Bloomberg