Monday, December 5, 2022

Korean Battery Recycler Plans Share Sale as EV Demand Surges


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(Bloomberg) — SungEel HiTech Co., a South Korean battery recycling firm, plans to promote shares on the nation’s tech-heavy Kosdaq bourse later this yr as it targets income of round $1 billion and a ten% international market share by 2030.

The recycler is aiming to boost about 140 billion gained ($110 million), in keeping with an individual accustomed to the matter. A consultant on the firm declined to remark.

SungEel swung to an working revenue of 16.8 billion gained final yr with a margin of about 11.4%, Chief Government Officer Yi Kang-myung mentioned in an interview. Gross sales for 2021 got here in at round 147 billion gained.

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Based in 2000, SungEel focuses on recycling lithium-ion batteries. It collects previous and faulty cells from automakers and among the nation’s largest battery makers, together with LG Power Resolution, and has the capability to extract about 4,400 metric tons of nickel and cobalt yearly.

Recycling is important for international locations’ net-zero targets as a result of it helps decrease costs of the metals utilized in batteries, the most costly a part of an electrical automobile. Proceeds from any preliminary public providing would assist SungEel obtain its goal of dealing with round a million spent cells by 2030, up from 100,000 at present, Yi mentioned.

“With battery-related shares buying and selling at excessive valuations, buyers could have excessive expectations for the agency even after an IPO,” mentioned Han Seung-Jae, an analyst at DB Monetary Funding Co. “SungEel HiTech is the one battery recycler in Korea that’s making a revenue and it has shut relations with native battery makers.”

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The corporate already has 9 recycling crops all over the world — three in South Korea and the remainder in China, India and japanese Europe. With container traces and different transport operators reluctant to hold second-hand batteries for security causes, Yi mentioned it’s higher to construct the services close to to the place the batteries are sourced.

Learn extra: Burnt-Out Ship Carrying 4,000 VW Automobiles Sinks in Tough Seas

In line with BloombergNEF, roughly two million metric tons of lithium-ion battery scrap might be obtainable for recycling yearly by 2030. South Korea is house to a few of the world’s prime 10 battery makers: LG Power, SK On Co. and Samsung SDI Co.

Battery recycling’s development prospects as customers embrace electrical automobiles and nations and automakers decide to phasing out combustion engines has seen firms wade into the sector. Redwood Supplies Inc. was created by Tesla Inc. co-founder J.B. Straubel and is likely one of the largest lithium-ion battery recyclers within the U.S. Li-Cycle Holdings Corp. listed in August and already has a market worth north of $1 billion.

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One early backer of SungEel is Samsung C&T Corp., a unit of Samsung Group that held a 6.3% stake within the firm as of December, firm filings present. With proceeds from an IPO, Yi plans to construct a brand new plant in Gunsan in Korea that may assist enhance output to 10,000 tons of cobalt and nickel and seven,000 tons of lithium carbonate.

Yi, a graduate of metals engineering on the prestigious Korea College in Seoul, initially based SungEel as a recycler of assorted different metals. Till the mid-2000s, it extracted silver from second-hand televisions.

Battery recycling, nonetheless, is a labor intensive and generally harmful course of. Explosions, combustion and toxic gases launched within the restoration course of may cause casualties and batteries have to be absolutely discharged earlier than the recycling begins.

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That course of may be divided into two phases — the bodily, which incorporates disassembly, crushing, screening, magnetic separation, washing and heating, and the chemical, which entails pyrometallurgical and hydrometallurgical processes. One measure of a battery recycler’s success is the manufacturing of “black mass” — a powdery substance that accommodates a wide range of metals, together with lithium, cobalt and nickel.

Firms like SungEel must work on automating extra phases of the recycling course of, in keeping with Chul-Wan Park, a professor at Seojeong School who specializes within the auto business. That may also lower down on the sheer manufacturing facility house wanted, he mentioned. 

©2022 Bloomberg L.P.

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