Seoul [South Korea], September 9 (ANI): LG Chem has secured a shareholder structure to comply with U.S. Inflation Reduction Act (IRA) rules by bringing Japan’s Toyota Tsusho in as the second-largest shareholder of its Gumi cathode plant, as per a report by Pulse, the English service of Maeil Business Newspaper Korea.
Quoting the company, the report said on Tuesday that Toyota Tsusho acquired a 25 per cent stake in LG-HY BCM, the cathode joint venture in Gumi. One of Toyota Group’s trading arms, Toyota Tsusho, is responsible for much of Toyota Motor’s raw material procurement.
“Following the transaction, LG Chem holds 51 per cent of the plant, Toyota Tsusho 25 per cent, and China’s Huayou Cobalt 24 per cent. Cathode materials produced at the plant will be supplied to North American battery customers through Toyota Tsusho,” the report noted.
The revised ownership structure allows the plant to avoid IRA restrictions. The law designates any company with 25 per cent or more equity held by Chinese or other restricted foreign entities as a “foreign entity of concern,” making it ineligible for tax credits. The Gumi plant was previously subject to the rule as Huayou Cobalt held 49 per cent, but the reduced stake now excludes it from the category.
The Gumi plant, with an annual capacity of 66,000 tons, is a core production base. It has adopted a next-generation cathode material technology that skips precursors and directly calcines tailored metals, enhancing product competitiveness.
LG Chem is also expanding its supply chain with projects in Tennessee, United States (scheduled for late 2026), Cheongju and Gumi in Korea, and Wuxi in China, to secure a stable global network.
The report, quoting LG Chem Vice Chairman Shin Hak-cheol, said Toyota Tsusho’s participation is “an important turning point for LG Chem to respond to IRA regulations and strengthen its competitiveness in the global cathode supply market,” adding that the company will further solidify its leadership in the battery materials sector with world-class products and strong partnerships. (ANI)
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