LG innotek moves up payment schedule ahead of Lunar New Year holiday

LG innotek will pay a combined 144.5 billion won ($120.5 million) of payments to its suppliers weeks earlier than scheduled to support small- and mid-size businesses reeling from the pandemic, the company said Tuesday.

The materials arm of LG aims to improve cash flow for partner companies struggling to operate their businesses, invest in facilities, and develop material components in the grip of an economic downturn.

By the end of last year, LG innotek already moved up the payment timeline for 72.1 billion of the 144.5 billion won. The remaining 72.4 billion won -- which was initially scheduled to be paid in February and March -- will be paid earlier on Jan. 27, a couple days before the Lunar New Year holiday according to the revised plan. The boosted cash flow is expected to support partner companies in covering holiday-driven expenses such as bonuses, wages, and raw material costs, the company stated.

The LG affiliate also scaled up its Win-Win Growth Fund to pool 103 billion won. The fund, which offers loans to suppliers at low interest rates, can now be deployed to relieve pandemic-driven financial burdens on top of supporting new technology development and new market entry.

“LG innotek will strive to pursue mutual growth with suppliers in order to improve customer experience that our company can exclusively offer.” said Jeong Cheol-dong, LG innotek CEO.

LG innotek received the highest rating from Corporate Partnership’s Mutual Growth Index last September for the fifth consecutive year.

By Ahn Ju-hee (dianahn@heraldcorp.com)