SEOUL, Aug. 28 (Korea Bizwire) — Samsung SDI Co., the battery-making arm of South Korea’s top conglomerate, Samsung Group, said Friday it will buy the cell material division of its chemical affiliate, in a move to bolster competitiveness in the sector.
Samsung SDI will take over the cell material unit of Samsung Fine Chemicals Co. for 18.7 billion won (US$15.9 million) on Sept. 16, the company said in a regulatory filing.
Samsung SDI will acquire the research and development facility, patent rights, staffs and the 58 percent stake of STM, a cell manufacturer jointly set up by Samsung Fine Chemicals and Japan’s Toda Kogyo Corp. in 2011.
The takeover will help reinforce its global competitiveness in the cell material business amid a fast-growing market for electric vehicles, Samsung SDI said.
STM mainly produces materials for secondary cells, or rechargeable batteries, on which Samsung SDI has been focusing as a fresh growth driver on increasing demand for smart devices.
Samsung SDI supplies the bulk of its battery products to Samsung Electronics Co., for its smartphones and wearable devices.
The deal between the two Samsung units also includes selling Samsung SDI’s 29.2 percent stake in unlisted Samsung BP Chemicals Co. for 81.9 billion won to the fine chemical unit, it added.
The takeover is the latest in the series of asset shake-ups by Samsung Group that has been undergoing a leadership change to Lee Jae-yong, the only son of the group’s patriarch Lee Kun-hee. The senior Lee has been bedridden following a heart attack last year.
The sale of the cell material unit to Samsung SDI is seen as part of the process to streamline the sprawling conglomerate that has nearly 70 affiliates.
Samsung sold its key chemical and defense units in November to Hanwha Group, the 10th-largest conglomerate in the country. Three months prior to that, Samsung SDI acquired the chemical material division of Cheil Industries Inc., the group’s de facto holding firm.
Samsung SDI is one of the world’s leading battery makers for hybrid cars, vying with its home rival, LG Chem, which also holds a significant global share in the electric car battery business.
The battery-making unit of Samsung Group counts BMW AG, Delphi Automotive Plc., Chrysler and Ford Motor Co. as its major clients.