SK Innovation "Battery Business Spin-off Decided in Connection with IPO"

[Image source=Yonhap News]

[Asia Economy Reporter Choi Dae-yeol] Kim Jun, CEO of SK Innovation, said on the 1st regarding the spin-off of the electric vehicle battery business, "We will flexibly review it in connection with the timing of the initial public offering (IPO)."

CEO Kim made this statement during the Story Day event held that day while unveiling the company's future strategy. Although there have been many discussions inside and outside the company about the spin-off of the battery business, this is the first time the CEO has officially confirmed it.

SK Innovation operates as a mid-level holding company for petroleum and chemical businesses within the SK Group while conducting the battery business independently. SK Inc. oversees SK Innovation, which in turn manages SK Energy (refining) and SK Comprehensive Chemical (petrochemicals), while directly handling the battery business.

CEO Kim explained that since the battery business requires significant capital investment, it will be linked to the IPO. He said, "A considerable amount of resources is needed for the growth of the battery business, and we are considering the spin-off as one of the financing methods. It has not yet been decided whether it will be a physical spin-off or a personnel spin-off."

He added, "We believe it is appropriate to go public when the battery business is properly recognized for its value in the market."

The company announced plans to invest 30 trillion won over the next five years to transform into a company focused on eco-friendly businesses, including batteries. The necessary funds will be raised through methods such as IPOs, joint ventures (JVs) with external companies, incentives, and asset restructuring. The company stated that if SK Innovation spins off the battery business, it will take on roles such as discovering new eco-friendly businesses, research and development, and mergers and acquisitions as a holding company.

When asked whether they are considering listing on the US Nasdaq after the battery business spin-off, he said, "It is an issue under consideration," but added, "We think that listing should be done in regions where the main business base exists, but we will consider options such as Nasdaq listing or simultaneous listing in Korea."

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