SK Innovation increases investment in SK On to boost EV battery business growth

22 December 2022, 01:46:31

According to SK Innovation's announcement on the 21, SK On has successfully increased a total of KRW 2.8 trillion in paid-in capital. This is the sum of SK Innovation's investment, which is equal to KRW 2 trillion, and Korea Investment Private Equity’s investment of KRW 0.8 trillion.

SK Innovation plans to invest KRW 1 trillion within this month and proceed with the remaining amount next year. This is SK Innovation’s strategy to enhance SK On’s corporate value by preemptively responding to the increase in demand for electric vehicle (EV) batteries in the mid- to long-term.

As SK On is expanding its business by winning orders from big customers such as Ford, Hyundai Motor, and Volkswagen, SK Innovation evaluates that SK On will be able to speed up its growth by securing investment funds without a hitch. In addition, direct investment by the parent company is expected to resolve uncertainty in the battery business-related market and have a positive impact on increasing shareholder value.

On November 30, SK Innovation announced that it could raise KRW 1.3 trillion from financial investors such as Korea Investment PE, and this investment is a follow-up to that previous announcement. Korea Investment PE can add the amount up to KRW 0.5 trillion next year, following its investment of KRW 0.8 trillion in SK On this year.

On SK On's side, the company plans to continue securing investment funds. In addition to Korea Investment PE, SK On also sees the possibility of attracting additional external investors in the future.

SK On has been focusing on building global production bases in the United States and Hungary. As recently reported, SK On has signed a memorandum of understanding with Hyundai Motor Group for cooperation in supplying EV batteries in North America. This is one example of the company’s moves to quickly preoccupy the future EV battery market.

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