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Koch Arm Agrees to $100 Million Bet on Li-Cycle Holdings

(Bloomberg) —

An arm of Koch Investments Group has agreed to purchase a $100 million convertible note in Li-Cycle Holdings Corp., a recycler of electric-vehicle batteries that went public by merging with a blank-check firm earlier this year. 

Koch Strategic Platforms’ investment will accelerate the growth of the Mississauga, Ontario-based company’s footprint in North America and elsewhere, Ajay Kochhar, co-founder and chief executive officer of Li-Cycle, said in an interview.

“The market for recycling is very much here and now — we’re growing in lockstep with the proliferation of electric vehicles and associated lithium-ion battery production,” Kochhar said. Between April and September of this year, Li-Cycle’s forecast for its global total addressable market rose 50% to over 2 million metric tons of lithium-ion battery materials available for recycling by 2025, he added.

Li-Cycle shares rose 8.5% in pre-market trading in New York to $11.93.

Li-Cycle works with companies including Ultium Cells LLC, a joint venture of General Motors Co. and LG Chem; and Univar Solutions, which in turn works with Mercedes-Benz U.S. International.

Read more: Ford Makes Biggest Bet in Carmaker’s 118-Year History on EVs

“We’re confident in Li-Cycle’s cutting-edge technology and in the company’s ability to deliver long-term value to its stakeholders throughout the battery supply chain,” David Park, president of Koch Strategic Platforms, said in an emailed statement.

Li-Cycle said it’s exploring working with Koch Industries subsidiaries including Koch Engineered Solutions, a provider of engineering, construction and procurement services, on activities including spoke fabrication and deployment, though nothing has been finalized. 

The note matures on Sept. 29, 2026 unless it’s redeemed, repurchased or converted earlier at a price of $13.43 a share, a 25% premium to the seven-day volume-weighted average price prior to its agreement. 

Formed in 2020, Koch Strategic Platforms this year has made bets on companies including Aspen Aerogels Inc. and Eos Energy Enterprises Inc.

Read more:
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Koch, Eyeing $3 Billion in Growth Equity Bets, Backs EVBoxFord Makes Biggest Bet in Carmaker’s 118-Year History on EVs

(Updates with company shares in fourth paragraph. An earlier version of the story corrected the spelling of CEO’s name in third paragraph.)

© 2021 Bloomberg L.P.


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