April 25, 2024

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“LG Life Sciences seems to have failed as a stand-alone firm. But it may able to jump up to a bigger scale when it’s backed by LG Chem’s rich production facility operation experience and capital,” an industry source said.

With the merger, competed on Jan. 1, LG Life Sciences has made a return to the battery maker after 15 years since it was spun off in 2001.

The move comes as Samsung and SK are making every effort to foster the bio industry as their new cash cow, investing a large sum of money.

Joining the new trend, LG Chem said earlier it will spend 300 billion won (US$249 million) to 500 billion won every year on research and development to enhance its business portfolio by leveraging the drug maker’s bio-business. The amount is three times higher than what LG Life Sciences has invested.

In a New Year message, Park Jin-soo, vice chairman of LG Chem, reassured his employees that the company’s new growth engines will be energy, water and bio sectors.

“This year, we will map out detailed growth strategies for green and red bio businesses while seeking to discover new projects in energy and water business sectors,” he said.

Unlike other conglomerates that decided to tap into the biopharmaceutical sector, LG Chem’s portfolio will be divided into three sub-fields.

They include the red biotechnology for producing drugs, white biotechnology -- which focuses on producing chemical products -- and bio fuel based on plant resources like corn and bean, as well as green biotechnology --which refers to the application of biological techniques to plants with the aim of improving the nutritional quality, quantity and production.

By Park Han-na (hnpark@heraldcorp.com)