Hyundai Motor executives fail to sell $1.25 billion shares in logistics affiliate
Hyundai Motor Company has said its chairman and his son failed to sell about $1.25 billion (£830 million) worth of shares in logistics affiliate Hyundai Glovis, thwarting a succession move at South Korea's second-biggest family-owned conglomerate.
The size of the sale spooked investors at a time of heightened market resistance to the tendency of South Korea's family-owned business empires, known as chaebols, to put the interests of kin ahead of ordinary shareholders, analysts said.
Kim Sung-soo, a Fund Manager at LS Asset Management which holds shares in Hyundai Glovis, said: "The block sale announcement was sudden and unexpected. The market will welcome deals only if they go as expected and in a rational manner."
Hyundai Motor Chairman Chung Mong-koo and Vice Chairman Chung Eui-sun on Monday offered 5.02 million shares at 264,000 won to 277,500 won ($244 to $256) each, a discount of up to 12 percent to the last closing price of Hyundai Glovis, bringing their total stake to below 30 percent.
The sale would have helped Eui-sun, the only son of Mong-koo, buy stakes in key units such as Hyundai Mobis while having freed Hyundai Glovis from antitrust scrutiny over inter-affiliate transactions, analysts said.
The sale collapsed due to its large size and as "some conditions were not met," Hyundai Motor said in a statement, adding that it had no plan to resume the block deal for now.
Hyundai Glovis shares, which have risen strongly for the past year, plunged by the daily limit of 15 percent after the announcement, as investors concluded the logistics unit may no longer be important to the chaebol's succession process.
With Hyundai and Samsung both seen preparing to hand over management control to new generations, investors are seizing the moment to stiffen their resistance to decisions made with little consultation and without sufficient regard to their interests.
Investor anger at a $10 billion property purchase by a consortium led by Hyundai Motor at three times the appraised value triggered a rare share buyback by the automaker and its affiliate Kia Motors last year.
Ultium Cells LLC/Li-Cycle: Sustainable Battery Manufacturing
Ultium Cells LLC - a joint venture between General Motors and LG Energy Solutions - has announced its latest collaboration with Li-Cycle. Joining forces the two have set ambitions to expand recycling in North America, recycling up to 100% of the scrap materials in battery cell manufacturing
What is Ultium Cells LLC?
Announcing their partnership in December 2019, General Motors (GM) and LG Energy Solutions established Ultium Cells LLC with a mission to “ensure excellence of Battery Cell Manufacturing through implementation of best practices from each company to contribute [to the] expansion of a Zero Emission propulsion on a global scale.”
Who is Li-Cycle?
Founded in 2016, Li-Cycle leverages innovative solutions to address emerging and urgent challenges around the world.
As the use of Lithium-ion rechargeable batteries in automotive, industrial energy storage, and consumer electronic applications rises, Li-Cycle believes that “the world needs improved technology and supply chain innovations to better recycle these batteries, while also meeting the rapidly growing demand for critical and scarce battery-grade materials.”
Why are Ultium Cells LLC and Li-Cycle join forces?
By joining forces to expand the recycling of scrap materials in battery cell manufacturing in North America, the new recycling process will allow Ultium Cells LLC to recycle cobalt, nickel, lithium, graphite, copper, manganese and aluminum.
“95% of these materials can be used in the production of new batteries or for adjacent industries,” says GM, who explains that the new hydrometallurgical process emits 30% less greenhouse gases (GHGs) than traditional processes, minimising the environmental impact. Use of this process will begin later in the year (2021).
"Our combined efforts with Ultium Cells will be instrumental in redirecting battery manufacturing scrap from landfills and returning a substantial amount of valuable battery-grade materials back into the battery supply chain. This partnership is a critical step forward in advancing our proven lithium-ion resource recovery technology as a more sustainable alternative to mining, " said Ajay Kochhar, President, CEO and co-founder of Li-Cycle.
"GM's zero-waste initiative aims to divert more than 90% of its manufacturing waste from landfills and incineration globally by 2025. Now, we're going to work closely with Ultium Cells and Li-Cycle to help the industry get even better use out of the materials,” added Ken Morris, Vice President of Electric and Autonomous Vehicles, GM.
Since 2013, GM has recycled or reused 100% of the battery packs it has received from customers, with most current GM EVs repaired with refurbished packs.
"We strive to make more with less waste and energy expended. This is a crucial step in improving the sustainability of our components and manufacturing processes,” concluded Thomas Gallagher, Chief Operating Officer, Ultium Cells LLC.