LG Energy Solution raises 1.6 billion dollars in bond sale

In Singapore, the South Korea-based battery manufacturer LG Energy Solution, Ltd. has launched a four-tranche United States dollar bond sale that could raise up to $1.6 billion. The senior unsecured deal is structured to provide the company with significant capital for both operational needs and strategic green initiatives.

The transaction includes $300 million of 2029 notes priced at 5.0%, $500 million of 2031 notes at 5.25%, and $300 million of five-year floating-rate notes priced at a compounded daily secured overnight financing rate (SOFR) plus 156 basis points. A fourth tranche consisting of $500 million in 2036 green notes was priced at 5.875%.

Market reception was strong despite broader caution due to geopolitical tensions in the Middle East. Order books showed significant oversubscription: the three-year tranche received over $2.8 billion from 154 accounts, the five-year fixed tranche exceeded $3 billion from 178 accounts, and the five-year floating-rate tranche surpassed $2 billion from 115 accounts.

LG Energy Solution, Ltd. plans to utilize the funds from the 2029, 2031, and floating-rate notes for general corporate purposes, including the refinancing of existing debt and capital expenditure. The proceeds from the 2036 green notes are earmarked for eligible projects focused on energy efficiency and low-carbon transportation.

The issuance was supported by a group of joint bookrunners, including Bank of America Corporation, Citigroup Inc., Crédit Agricole S.A., HSBC Holdings plc, and JPMorgan Chase & Co.. The bonds received a BBB rating from S&P Global Ratings and a Baa2 rating from Moody’s, with settlement slated for April 2.

Elsewhere in the primary markets, Australia-based WESTPAC BANKING CORP priced a 1 billion euro ($1.16 billion) covered bond due in January 2031 at 28 basis points over mid-swaps. The deal was led by Barclays PLC, BNP Paribas, Commerzbank AG, HSBC Holdings plc, Natixis, and WESTPAC BANKING CORP.