South Korea’s SK Materials Company and US-based Group 14 Technologies are to join forces to build a new lithium-ion battery materials factory in South Korea.

SK Materials, which mainly makes materials for electronic parts and displays, said it had agreed to take a 75% stake in the new KRW850bn (US$726bn) joint venture, with the US company taking a quarter.

Group 14 is a global provider of lithium-silicon battery materials which help improve energy density.

A new factory will be built in Sangju in the south east of the country to make silicon anodes for electric vehicle batteries.

Construction is scheduled to begin in October, with completion scheduled for next year.

SK, the investment and holding company of SK Group, last month said it planned to take over SK Materials as part of a corporate restructuring at the group which has stepped up its investments in the global EV battery business.

The merger is subject to shareholder approval next month and is expected to be finalised in December.