Samsung SDI Co., South Korea’s second-largest battery manufacturer, announced plans to raise 2 trillion won ($1.37 billion) through a stock sale as part of its broader growth strategy.

The company’s board of directors approved the capital increase to “preemptively” secure funding in preparation for a rebound in the car battery market, Samsung SDI stated in a press release.

As part of the plan, Samsung SDI will issue approximately 11.82 million common shares at 169,200 won per share, with the final stock price to be determined on May 22, according to Yonhap news agency. The newly issued shares will first be offered to the company’s existing shareholders, with listing scheduled for June 19 following subscription rounds from May 27 to June 3.

The proceeds from the rights issue will be used to invest in Samsung SDI’s joint venture with General Motors Co. in the United States, expand production capacity at its plant in Hungary, and develop facilities for its solid-state battery line in South Korea.

Additionally, the company stated that it will explore various financing options, including leveraging its existing assets, to navigate the electric vehicle (EV) “chasm”—the period before widespread EV adoption.

Despite challenges in the EV market, Samsung SDI’s facility investments have surged from 1.7 trillion won in 2019 to 6.6 trillion won last year. Market research firms project that the global car battery market will grow at an average annual rate of 20 percent between 2025 and 2030, the company noted.

Meanwhile, Samsung SDI has signed an initial agreement with Hyundai Motor and its affiliate Kia to jointly develop specialized batteries for robotics. The memorandum of understanding (MOU) aims to create high-performance batteries designed to enhance energy density, output, and usage time in robotic applications.

“Through this collaboration, we will introduce differentiated technologies and high-quality products to the robot battery market,” said Cho Han-jae, Executive Vice President of Samsung SDI.

—IANS