SK, Data Center Fire Compensation Setback..."Q4 Operating Profit -7% Downward Factor"

SK C&C, Pangyo Data Center Fire
SK Shares Plunge 5%
Kakao Announces Plans to Discuss Compensation with SK C&C

[Image source=Yonhap News]

[Asia Economy Reporter Hwang Yoon-joo] An analysis has emerged that SK's operating profit estimate for the fourth quarter will drop by 7% due to the fire at the Pangyo Data Center in Seongnam-si, Gyeonggi-do. Consequently, SK's stock price is also down by 5%.

As of 10:06 a.m. on the 17th, SK is trading at 195,000 KRW, down 5.34% (11,000 KRW) compared to the previous trading day.

A fire broke out in the electrical room on the third basement floor of Building A at the SK C&C Pangyo Campus in Seongnam-si, Gyeonggi-do, and was extinguished after about eight hours. This facility manages communication data for Kakao, Naver, and SK, and due to the power outage caused by the fire, services for Kakao, Daum, and Naver experienced disruptions.

SK C&C had absorbed and merged the former group holding company, SK Inc. As a result, SK is bearing the full brunt of the adverse effects. In particular, Kakao's announcement that it will seek damages from SK C&C is interpreted as a factor causing a larger drop in the stock price.

On the morning of the 17th, Kakao announced, "We plan to discuss compensation for losses incurred by Kakao and its major subsidiaries with SK C&C after prioritizing the normalization of services."

Kim Jin-woo, a researcher at Daol Investment & Securities, stated, "Assuming the scope of damage compensation is limited to paid users, the impact on operating profit is estimated to decrease by about 12 billion KRW," adding, "This is a factor that could lower the existing fourth-quarter operating profit estimate by 7%."

Researcher Kim also said, "If compensation extends to sales amounts of businesses connected to Talk Channel and Kakao Pay, it is still difficult to estimate the scope," and evaluated, "Considering the past KT Ahyeon station fire case, the possibility of sales amount compensation does not seem high."

Previously, KT took about four months to reach an agreement on the compensation scale after the Ahyeon station fire. Researcher Kim explained that there is also a possibility that Kakao will provide advance compensation and then claim subrogation rights from SK C&C. He predicted, "There is also a high possibility that investment in data centers will increase after establishing recurrence prevention measures."

Meanwhile, according to the police, the forensic investigation of the SK C&C Pangyo Data Center fire revealed that five battery racks in the electrical room on the third basement floor were completely burned. It is presumed that the fire started due to electrical factors around the batteries or racks.

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