SEOUL, June 21 (Korea Bizwire) — LG Electronics Inc. and Canadian auto parts maker Magna International Inc. are in the final phase of launching their electric vehicle (EV) powertrain joint venture next month, industry insiders here said Monday, as they review board member appointment plans for the new company.
The South Korean tech giant is scheduled to spin off its green business in its vehicle solutions unit on July 1 to set up LG Magna e-Powertrain Co. Magna will then acquire a 49 percent stake in the new firm for US$453 million.
Both LG and Magna are currently focusing on choosing their board representatives in the joint venture. Based on their ownership stake, three members will be selected by LG, while Magna will pick two.
The two reportedly agreed that LG will appoint the CEO of LG Magna e-Powertrain, while sharing the chief financial officer position.
LG and Magna are expected to create a big synergy with the joint venture as the EV industry grows sharply.
The two already established LG Magna e-Powertrain’s subsidiaries in Nanjing, China, and Michigan, the United States, in April to expand its global supply chain.
Local analysts predict the joint venture’s revenue to top 500 billion won (US$440 million) this year. LG previously said it expects the joint venture to post annual sales growth of 50 percent from 2022 to 2025.