South Korean-based LG Energy Solution is acquiring full ownership of NextStar Energy from automaker Stellantis.
NextStar was a joint venture between the two companies that came about in 2022 to build Canada’s first large-scale battery manufacturing facility in Windsor, Ont.
In November, it was announced batteries made at the plant would now be prioritized for power grid storage systems and not primarily the automotive industry as originally promised.
Stellantis said it would be selling its 49 per cent equity stake in NextStar to LG Energy Solution in a Friday morning statement.
A spokesperson for the automaker says the stake was sold for a nominal fee in return for “undisclosed favorable benefits.” The deal is subject to conditions and other approvals, the company said.
Stellantis says it remains a “committed customer” and will continue to source battery products from NextStar.
To date, the companies say roughly 1,300 people are employed at the Windsor plant with a long-term goal of 2,500 having employees.
The federal government has previously pledged up to $10 billion in production subsidies to NextStar Energy. The other $5 billion is coming from the provincial government.
“This new ownership structure strengthens Canada’s position as a leader in battery manufacturing,” said Danies Lee, NextStar’s chief executive officer.
“It provides long-term certainty to continue investing in our Canadian workforce and our manufacturing capacity while delivering sustained economic benefits for Canada and Ontario.”
The province isn’t expecting layoffs because of Stellantis selling off its stake in the factory.
“This transfer in ownership will not lead to any job losses at the facility,” said Jennifer Cunliffe, a spokesperson for Vic Fedeli’s office. He’s Ontario’s Minister of Economic Development, Job Creation and Trade.
Ontario Premier Doug Ford called the decision by Stellantis is a good deal, while federal industry minister Melanie Joly also gave the news a thumbs up.
“I think it’s really good news, I think that it’s very welcome and it shows that LG is here for a long run,” she told reporters at a stop in Guelph, Ont., where she discussed Canada’s auto strategy, unveiled Thursday.
“[I’m] saying that we will invest in those who invest in us. What do I mean by that? We just signed a partnership with Korea on auto manufacturing last week. What are we seeing this week? LG is buying out Stellantis to invest more in Canada. Good news.”
Industry Minister Mélanie Joly said the federal government will recover ‘our money’ from Stellantis after spending more than $220 million to help the automaker upgrade its plants before it announced plans to move some production to the U.S.
The move comes on…
Read More: Stellantis selling its stake of Ontario battery factory to South Korea’s LG
