SEOUL -- LG Chem said on Sept. 12 that it acquired U.S. automotive adhesive specialist Uniseal to capture demand for those materials in the automotive industry, which is striving to lighten vehicles by switching from welding and bolts.
The South Korean chemical maker purchased a 100% stake in the Indiana-based company's shares from parent Koch Enterprises in a deal likely worth around 150 billion won ($133 million).
Founded in 1960, Uniseal supplies U.S. automakers like General Motors and Ford Motor. Its annual sales were about $56 million last year.
The market for automotive adhesives is expected to rise 8% annually from about $4.5 billion in 2017 to over $7 billion in 2023, said LG Chem. It also sees growth for adhesives in electronics parts that are increasingly used in electrified vehicles. The shift from steel to plastic for certain parts of the car frame is expected to provide a tailwind as well.
The acquisition is part of the LG Group's strategy to establish the auto industry as a key growth market. The company's main products for the sector are electric car batteries and ABS (acrylonitrile butadiene styrene) plastic used in interior materials.