SK Inc. invests an additional 100 billion KRW in Watson, the world's No.1 copper foil manufacturer

[Asia Economy Reporter Yoonju Hwang] Investment holding company SK Inc. is strengthening its core electric vehicle battery component business through additional investments in global copper foil manufacturers.

On the 17th, SK Inc. announced that it has signed a contract to invest an additional approximately 100 billion KRW in Wason, a Chinese company that manufactures copper foil, an essential component for electric vehicle batteries. This decision comes about a year after a new investment of approximately 270 billion KRW in April last year, as a proactive investment in the rapidly growing copper foil market.

Wason is the world's number one copper foil manufacturer and has been aggressively expanding its production capacity through competitor acquisitions and new factory establishments since SK Inc.'s investment last year. As of July, Wason's annual production capacity of battery-grade copper foil is 40,000 tons, the largest scale among global major copper foil manufacturers, with plans to increase it to 140,000 tons by 2025.

Copper foil is a thin film made by processing copper with advanced technology and is used as the anode material, one of the four core materials that make up batteries. The key technology in copper foil manufacturing is producing thin, wide, and uniformly surfaced copper foil in long lengths, which requires advanced process control technology and excellent equipment competitiveness. Only six companies worldwide can produce high-quality copper foil that meets the stringent requirements of global automakers, and Wason is known to have infinite growth potential as it is also considering an IPO in the future.

Wason, which possesses excellent technology and cost competitiveness, has established a stable customer portfolio centered on global major battery manufacturers and is experiencing high growth through rapid productivity improvements. In 2019, Wason's sales and operating profit were 417.7 billion KRW and 78.1 billion KRW, respectively, and its EBITDA reached 100 billion KRW, marking a remarkable 32% increase compared to the previous year.

With the explosive growth of the electric vehicle market, the copper foil market is also expected to expand further, and Wason's future growth is anticipated to be even steeper. The current copper foil demand from global battery manufacturers, including CATL, the world's largest electric vehicle battery company, is about 140,000 tons, but it is projected to increase to 750,000 tons by 2025. Along with this rapid demand increase, the importance of securing high-quality copper foil due to the intensifying supply shortage is expected to grow significantly.

An SK Inc. official said, "SK is fostering the electric vehicle-related parts and materials business as a growth engine, and Wason's high growth once again proves SK Inc.'s investment foresight. We also expect an increase in corporate value through proactive additional investment."

This content was produced with the assistance of AI translation services.