By Kwanwoo Jun

LG Chem Ltd. is buying a 5.7% stake in U.S. mining company Piedmont Lithium Inc. for $75 million, strengthening its presence in the North American battery-material supply chain.

The South Korean company said in a regulatory filing early Friday that it plans to buy about 1.1 million of Piedmont's common shares on Feb. 23.

Under a separate offtake deal reached by both sides, Piedmont will supply LG Chem with 200,000 tons of spodumene concentrate, a high-purity lithium ore, over the next four years.

The agreements illustrate tax credits and other benefits that the U.S. Inflation Reduction Act grants to battery industries. Lithium is one of the key materials needed to make batteries.

"We welcome LG Chem as a shareholder in Piedmont and are excited to partner with them to supply North American lithium that will meet the requirements of the IRA and support the development of the U.S. battery supply chain," Piedmont President and CEO Keith Phillips said in a press release.

"This agreement allows LG Chem to provide differentiated values to North American customers with products that satisfy IRA standards by preemptively securing raw materials in the U.S., our key market," LG Chem Vice Chairman and CEO Shin Hak-cheol said in the release.

LG Chem plans to build a $3 billion factory in Clarksville, Tennessee, to supply battery materials for electric vehicles. LG Chem is the parent company of South Korea-based EV battery maker LG Energy Solution Ltd.

Write to Kwanwoo Jun at kwanwoo.jun@wsj.com

(END) Dow Jones Newswires

February 16, 2023 19:58 ET (00:58 GMT)

Copyright (c) 2023 Dow Jones & Company, Inc.
Piedmont Lithium (ASX:PLL)
Historical Stock Chart
Von Nov 2024 bis Dez 2024 Click Here for more Piedmont Lithium Charts.
Piedmont Lithium (ASX:PLL)
Historical Stock Chart
Von Dez 2023 bis Dez 2024 Click Here for more Piedmont Lithium Charts.