LG Chem Vice Chairman Park Jin-soo. (Photo: LG Chem)

LG Chem aims to be among the top five chemical companies in the world. To this end, the company plans to expand its business portfolio to include core business areas such as basic materials, battery, information electronics and life science, reinforce R&D activities for the future, and prepare for an entry into the bio industry through a merger with LG Life Sciences.

The Basic Materials & Chemicals Business Division is restructuring its business portfolio, shifting into value-added synthetic resins, engineering plastics, high-absorbent resins, high-performance synthetic rubber. The company is fostering future materials products to maintain a competitive edge in the global market.   

The Energy Solutions Business Division has a strategy to maintain the No. 1 position in winning mega-projects. That strategy includes maintaining a competitive edge in terms of price, function and safety through preemptive R&D activities. The division plans to make aggressive inroads into the energy storage system (ESS) market by releasing products with functions differentiating itself from its rivals and a price competitive edge. 

It has worked out strategies to advance the restructuring of its business portfolio by exploring new markets with innovative products outfitted with small batteries and optimized for the latest smart gadgets. 

The IT and Electronic Materials Business Division plans to improve the profitability of such conventional business areas as polarizers and 3D film-type patterned retarders (FPR). The division plans to strengthen the competitiveness of such new business areas as functional films and water solutions businesses. In particular, the division plans to solidify the No. 1 position in the global polarizer market, which is predicted to maintain an annual growth rate of more than 30 percent by expanding polarizer lines in China. Ever since LG Chem has become the first company to commercialize LCD polarizers in 2000, the business division has steadily grown through aggressive investment in R&D and the development of differentiated products. As a leading global company in the polarizer and market, LG Chem also has been strengthening global competitiveness in the areas of ITO Film, touch panels, and circuit board materials. 

The Life Sciences Business Division plans to nurture the Zemiglo, Korea’s first new drug to treat diabetes, into a leading market product. The division plans to accelerate efforts to develop new drugs to rise to the nation’s top leader in the metabolic disorder and bio medicine segments and explore overseas markets. It plans to advance the release of such drugs as diplococcus pneumoniae and LDVD, a mixed vaccine for the prevention of diphtheria, tetanus, pertussis, hepatitis B, Haemophilus Influenzae type b (Hib), and poliomyelitis by conducting their clinical tests in Korea and abroad. 

Merger With LG Life Sciences 

LG Chem strives to expand its bio business through the merger with LG Life Sciences. In particular, the company is targeting the red biotechnology segment, comprising the prevention of diseases, diagnostic agents and new drugs. The global red biotechnology market, predicted to grow at an annual average rate of 5 percent, is projected to surge to 140 trillion won in 2020.

LG Chem, which is now a top-10 company in the world, is solidifying such conventional basic and IT materials as the EV battery segment, which have seen an upsurge of late, as well as nurturing new industries, including bio, as future new growth engines.

Last April, LG Chem acquired Farm Hannong. The company is now in the process of merging with LG Life Sciences. 

These steps are in keeping with LG Chem’s strategies to ramp up a competitive edge in conventional basic materials, EV battery and information electronics sectors, and build a balanced business portfolio comprising of bio, with the goal of raising its global standing to a global top-five chemical company.

In particular, the consolidation of LG Chem and LG Life Sciences is considered as optimal in order to tap the red biotechnology business in a quick and efficient manner. 

LG Chem, which has built a production base connecting Ochang, Chungcheongbuk-do, Nanjing, China, and Holland, Michigan, has supplied tens of thousands of batteries. A survey on the competitiveness of global EV battery makers by the market survey company Navigant Research showed that LG Chem placed first in the world in 2013 and 2015.

The company is predicted to see the EV battery business post 3.7 trillion won and 7 trillion won in sales in 2018 and 2020, respectively, thanks to the explosive growth of the global EV car market. 

The U.S. investment bank Merrill Lynch forecast that the global EV car market will balloon to $32 billion in 2020, tripling from $11 billion in 2015.

The EV battery business has emerged as one of LG Chem’s mainstay businesses. Announcing its 3rd quarter business performances, Kim Jong-hyun, head of LG Chem EV Battery Business Division, said the EV battery business has become a pillar. He went on to say that EV battery prices will fall due to cheaper material prices, and they will see their capacity rise.