Korean battery maker LG Energy Solution Ltd. said Friday it has agreed with a U.S. company to terminate a supply contract signed in 2024 by mutual consent.

In a regulatory filing, LG Energy Solution said it has canceled the supply deal worth 3.9 trillion won ($2.69 billion) signed with U.S.-based battery pack producer Freudenberg Battery Power System (FBPS) LLC.

LG Energy Solution said the termination came as FBPS decided to pull out from the battery industry.

LG Energy Solution signed the $2.7 billion agreement with the U.S. company in April and had already implemented $110 million of the deal.

Last week, LG Energy Solution announced the cancellation of a 9.6 trillion-won battery supply order from Ford Motor Co. signed last year.

Following the latest regulatory filing, the combined amount of contracts terminated this month for LG Energy Solution reached 13.5 trillion won, which accounts for around half of the company’s annual sales of 25.6 trillion won posted in 2024.

The South Korean battery maker, however, said the terminations are expected to have a limited impact on its financial health.

“We have not made an investment for building specialized production facilities nor expenditures for research and development projects. Thus, there are no additional costs incurred due to the termination,” the company said.

“We intend to take this as an opportunity to streamline relationships with uncertain customers and secure a more stable source of demand,” it added.