BDA advises LG Energy Solution on the acquisition of NEC Energy Solutions

BDA Partners is pleased to announce that its client, LG Energy Solution (“LG ES”), Korea, has closed the acquisition of NEC Energy Solutions (“NEC ES”), based in the USA, from NEC Corp, Japan. The value of the transaction was not disclosed.

BDA Partners was the exclusive financial advisor to LG ES on the transaction.

NEC ES was established in 2014, by NEC’s acquisition of the ESS (Energy Storage System) SI (system integration) business of A123 Systems, a subsidiary of Wanxiang Group, China. Its well-recognized, proprietary system-level ESS platform, “AEROS”, has built a track record of managing 986 MW of energy storage across 141 projects worldwide. NEC ES sources 70% of its projects from developed markets, notably in North America and Europe. NEC ES was responsible for some of Europe’s largest ESS Projects including Glassenbury in the UK (40MW) and Jardelund in Germany (48MW). NEC ES offers installation & O&M services. Recording a revenue of over US$210m in 2020, NEC ES boasts a robust revenue growth of 60% (3-year CAGR).

LG ES is a Korea-based, world-leading, lithium-ion battery manufacturer, active in automotive, mobility, IT and ESS batteries. Manufacturing battery cells through its best-in-class laminating & stacking, LG ES has secured blue-chip ESS clients in power grids, commercial, residential, and UPS. It is the market leader in the ESS battery industry.

The ESS market is growing fast. Clients have asked battery manufacturers to provide a turnkey to enhance reliability and convenience through a single contract that covers procurement to warranty. LG ES is acquiring NEC ES to respond quickly to the needs of customers and strengthen competitiveness in the market. Further, following the acquisition, LG ES will establish a new corporation – LG Energy Solution Vertech, through which LG ES will expand its offering from battery supply to ESS design/after-sale support, and solidify its leadership in ESS.

Howard Lee, Partner and Head of Seoul at BDA Partners, commented: “We’re happy to facilitate this transaction where conglomerates from two countries, Korea and Japan, have come together to progress an important ESG theme, in the ESS sector. We believe BDA will continue to add value for clients seeking cross-border growth, across Asia and beyond.”