Lotte Chemical Nears SPA Signing for Acquisition of Iljin Materials

[Asia Economy Reporter Park So-yeon] Lotte Chemical is acquiring Iljin Materials, a manufacturer of copper foil, a key material for secondary batteries. This is the first large-scale merger and acquisition (M&A) since declaring its entry into the electric vehicle materials sector.

According to the investment banking (IB) industry on the 28th, Lotte Chemical is expected to sign a stock purchase agreement (SPA) for the acquisition of Iljin Materials as early as the beginning of next month. The acquisition target is 53.3% of the shares held by Heo Jae-myung, president of Iljin Materials.

Lotte Chemical had virtually participated alone in the main bidding held on the 19th of last month and has been negotiating with Iljin Materials.

The share acquisition amount is known to be around 2.5 trillion to 2.7 trillion KRW. Based on the closing price the previous day, Iljin Materials' market capitalization is 2.6283 trillion KRW. The price offered includes a management premium of about 80-90% on the market value (1.4008 trillion KRW) of the 53.3% stake to be acquired. Citi Global Markets Securities handled the sale process.