Korea’s IMM collects nearly $500m to fuel development of EV batteries

IMM will consider raising up to $600m for its debut Korea Battery & ESG Fund dependent on investor demand, PEI understands.

Korea’s IMM Credit & Solutions has collected nearly $500 million for its first growth equity fund targeting the electrical vehicle battery sector, Private Equity International has learned.

Korea Battery & ESG Fund, which had an initial 400 billion won ($332 million; €297 million) target, held a first close late last year, according to a source with knowledge of the matter. The firm will consider raising up to $600 million before final close, dependent on investor demand.

The vehicle is anchored by Korea’s LG Chem, which committed 150 billion won in May last year, per a statement at the time. The remainder has come mainly from Korean LPs, the source noted.

IMM Credit & Solutions was formed last year as a subsidiary of IMM Holdings, which also owns IMM Private Equity. The latter is deploying its $1.8 billion IMM RoseGold IV and is expected to return with a successor this year, PEI reported in July.

IMM declined to comment.

KBE was structured in the form of a Hong Kong limited partnership fund, according to a February statement from law firm Dechert. Though Dechert declined to comment on IMM’s rationale, benefits of the structure – introduced by Hong Kong in 2020 – include lower set up costs and greater simplicity given that it is subject only to one set of laws, Dechert partner Michael Wong told PEI.

The fund, which invests globally, last month participated in a $125 million Series A financing round for Canada-headquartered Lithion Recycling, which has developed a more efficient process to recover materials from lithium-ion batteries and their waste products, per a statement.

Private investment into the electric vehicle sector appears to be on the up. European tech investor Verdane made its first deal in this space last week, taking a minority stake in EV charging services business EVA Global from its recently closed €300 million impact fund, affiliate title New Private Markets reported. EQT signed an agreement this week to acquire EV charging operator InstaVolt through its infrastructure platform.

Endowments, foundations and families are among the most bullish LPs in this space, often investing via renewable energy infrastructure and climate technology strategies, Laura O’Brien, investment director at investor adviser Cambridge Associates, said at PEI’s Women in Private Markets Summit last year.

“I think they see it as an opportunity to get into this space and the returns are there – they’re proven,” she said. “Technologies and infrastructure around electric vehicles are just going to grow, so it’s just a growth strategy really.”