"Corona Separates the Wheat from the Chaff"‥SK Seizes Opportunity Amid Crisis

[Asia Economy Reporter Park So-yeon] Due to the spread of the novel coronavirus infection (COVID-19), many companies are preparing for an uncertain future amid an uncertain business environment. However, there are also reports of companies finding opportunities amid the crisis.

SK Inc. has attracted attention as it is known to be the second-largest shareholder of Korea Supercooling, a logistics company that is the only one in Korea capable of distributing COVID-19 vaccines.

SK revealed that before the outbreak of COVID-19, in January, it invested about 25 billion KRW in Belstar Superfreeze, which owns 100% of Korea Supercooling’s shares, and holds a 20% stake.

SK also reportedly holds an option to invest an additional 12.5 billion KRW.

The COVID-19 vaccine developed by the U.S. pharmaceutical company Pfizer, which recently showed positive results in clinical trials, must be distributed at an ultra-low temperature below minus 70°C, and Korea Supercooling is said to be the only company in Korea with such technological capability.

According to SK, Korea Supercooling’s competitiveness lies in its technology that recycles the cold energy generated during the process of converting liquefied natural gas back into gas at an ultra-low temperature of minus 162 degrees as a refrigerant for logistics.

Korea Supercooling completed a 28,000-pyeong low-temperature logistics center in the Oseong Industrial Complex in Pyeongtaek, Gyeonggi Province, in April last year and has been operating it since June. It is also participating in the development project of an ultra-low temperature complex logistics center in the new port hinterland of Songdo International City, Incheon.

If a cold chain cluster (a low-temperature distribution system for temperature-sensitive products) is established on a site near the LNG terminal in Songdo, Incheon, a logistics center dedicated to storing pharmaceuticals such as COVID-19 vaccines could also be built there.

SK entered the logistics business in 2017 by investing in the global logistics company ESR (E-Shang Redwood Group). Due to the recent increase in e-commerce, the value of SK’s stake has doubled in just two years.

SK Hynix amazed the world by successfully completing a major merger and acquisition (M&A) worth about 10 trillion KRW even amid the COVID-19 situation. It announced the acquisition of Intel’s memory semiconductor business.

Last month, SK Hynix announced that it would acquire Intel’s memory business unit operating in Dalian, China, for 10.31 trillion KRW. The acquisition target includes Intel’s entire production facilities in Dalian, excluding the SSD business unit, NAND standalone and wafer business, and the Optane business unit.

This acquisition instantly raised SK Hynix’s market share in the NAND flash market to second place, following Samsung Electronics.

As of the second quarter of this year, the market share in the NAND flash segment of the memory semiconductor market was led by Samsung Electronics (31.4%), followed by Kioxia (17.2%), Western Digital (11.5%), with Hynix (11.7%), Intel (11.5%), and Micron Technology (11.5%) competing closely for market share.

Lee Seok-hee, CEO of SK Hynix, said, "We are very pleased that SK Hynix, which has led innovation in NAND flash technology, and Intel’s NAND business unit can create a new future together. By leveraging each other’s strengths, SK Hynix will actively respond to diverse customer demands, secure competitiveness in the NAND sector comparable to DRAM, and optimize its business structure."

The memory semiconductor market experienced a downturn due to oversupply in 2018 but has been recovering since the end of last year. The activation of the non-face-to-face economy due to COVID-19 has increased demand for data centers, leading to a boom. Market analysis firms predict that the memory semiconductor boom will continue for the next several years.

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