South Korea's antitrust regulator on Tuesday approved the launch of a joint venture between LS, the country's 16th-largest conglomerate, and battery material producer L&F Co.
The go-ahead for the new company that will produce precursors, tentatively named LS-L&F Battery Solution, came after the two firms filed applications in June, the Fair Trade Commission (FTC) said.
A precursor is a specific chemical material containing nickel, cobalt, manganese and aluminum before it is turned into cathodes, a key secondary battery material that determines the power and range of electric vehicle batteries.
Precursors account for 65-70 percent of the cost of cathodes.
In the application, LS and L&F said the new venture, forged under an 55:45 agreement, is aimed at establishing a "value chain" for secondary batteries that comprises resources, precursors and cathodes.
LS said earlier this month that it plans to invest 1.84 trillion won (US$1.37 billion) to build a battery precursor plant in the Saemangeum complex, a reclaimed area in North Jeolla Province.
"The venture is expected to help build a market ecosystem, as it will ignite competition in the precursor industry and promptly expand its supply to meet the increasing demand for secondary batteries in the electric car sector," the FTC added.
Source: Yonhap News Agency