LG CNS Announces Ambitious Overseas M&A Plans with IPO Funding
Deal News | Dec 06, 2024 | EIN
LG CNS, a subsidiary of LG Group, has announced plans to use a significant portion of funds raised from its upcoming IPO for overseas mergers and acquisitions (M&A) with IT service companies. The IPO aims to raise approximately 510 billion won, with 330 billion won earmarked specifically for M&A. This strategic move aims to boost LG CNS's influence in the global IT market by acquiring local IT service specialists. The company plans to distribute the M&A funds over the years 2025 to 2027. LG CNS also plans to allocate funds for debt repayment and the refurbishment of its data centers. This IPO supports LG CNS's efforts to diversify and expand into public and financial sectors, reducing its reliance on intra-group business with LG affiliates like LG Chem and LG Electronics. The final IPO price will be confirmed in January, potentially increasing the raised amount to 600 billion won.
Sectors
- Information Technology
- Investment & Finance
Geography
- South Korea – LG CNS, an LG Group subsidiary, is based in South Korea and the IPO is being conducted on the Korea Exchange.
- Global – LG CNS plans to use the IPO funds for international mergers and acquisitions, aiming to expand its overseas market influence.
Industry
- Information Technology – LG CNS is an IT service company and plans to expand its presence globally by acquiring IT service specialists.
- Investment & Finance – The article discusses LG CNS's use of IPO proceeds for strategic financial investments, including mergers and acquisitions.
Financials
- 330 billion won – The amount allocated for overseas M&A from the IPO proceeds.
- 510 billion won – The total expected funds to be raised from the IPO.
- 600 billion won – Potential total funds raised from the IPO if the offer price reaches the upper end.
- 160 billion won – Funds allocated for debt repayment from the IPO proceeds.
- 25 billion won – Funds allocated for data center refurbishment from the IPO proceeds.
Participants
| Name | Role | Type | Description |
|---|---|---|---|
| LG CNS | Target Company | Company | An IT service company and subsidiary of LG Group, planning to use IPO proceeds for overseas M&A. |
| LG Group | Parent Company | Company | The conglomerate of which LG CNS is a subsidiary. |
| LG Chem | Client | Company | Part of LG Group and one of LG CNS's primary clients. |
| LG Electronics | Client | Company | Part of LG Group and one of LG CNS's primary clients. |
| LG Uplus | Client | Company | Part of LG Group and one of LG CNS's primary clients. |