SK Innovation's 1.18 Trillion Won Capital Increase to Accelerate Green Business

Board Approval on the 23rd, Vice Chairman Kim Jun Sends Shareholder Letter
Securing Funds for Future New Growth Business Investment
Purpose of Strengthening R&D Capabilities and Establishing Stable Financial Structure

SK Innovation is securing funds for new growth businesses, strengthening research and development (R&D) capabilities, and establishing a stable financial structure through a paid-in capital increase worth over 1 trillion won.

SK Innovation announced on the 23rd that its board of directors approved a plan to proceed with a paid-in capital increase amounting to 1.18 trillion won. The scheduled issue price is 143,800 won per share, and 8.19 million new shares (an increase ratio of 8.7%) will be issued. The final issue price will be confirmed in September. The paid-in capital increase will be conducted through a rights offering to shareholders followed by a general public offering of any unsubscribed shares.

Kim Jun, Vice Chairman and CEO of SK Innovation, directly explained the background of the capital increase in a shareholder letter following the announcement. Vice Chairman Kim said, “In the company’s Carbon to Green innovation process, we are making large-scale investments in green businesses such as the battery business. We decided on the paid-in capital increase to accelerate the transition to green businesses, develop new businesses such as next-generation small modular reactors, hydrogen, and ammonia, secure related R&D capabilities, and establish a sound financial structure.”

In June last year, Kim Jun, Vice Chairman of SK Innovation, delivered the keynote speech at the 'SK Innovation Global Forum' held in San Jose, California, USA, introducing SK Innovation's direction for building a Green Portfolio and its commitment to business model innovation.
[Photo by SK Innovation]

In its ‘Carbon to Green’ strategy announced in 2021, SK Innovation stated that it would increase the proportion of green assets from about 30% (as of 2020) to 70% by 2025 and transform its business structure to focus on green industries. Since then, electric vehicle batteries and separators (LiBS) have reached a global level, and SK Innovation is actively investing in next-generation energy fields, developing new businesses, and creating a green campus to strengthen R&D infrastructure. Vice Chairman Kim said, “In addition to the paid-in capital increase, we are continuously making efforts to secure investment funds through various means such as asset efficiency improvements and to maintain a stable financial structure.”

Vice Chairman Kim also explained measures to protect shareholder value. He said, “The advanced manufacturing production tax credit (AMPC) effect related to local production of the battery business in the U.S., productivity improvements, and other factors are expected to lead to a market revaluation of the company’s corporate value. Therefore, we decided on a rights offering to shareholders to guarantee subscription rights for new shares to our shareholders.”

He added, “Through the ‘Dialogue with Shareholders’ held last March, we conveyed the company’s strong commitment to shareholder returns, including the mid- to long-term shareholder return direction linked to the upcoming SK On initial public offering (IPO). We will also review the use of treasury shares held by the company in a way that aligns with enhancing shareholder value.”

Finally, Vice Chairman Kim said, “This paid-in capital increase is a decision to take the company to the next level by accelerating the transition to Green Biz based on a stable financial structure. We ask for the unwavering support and encouragement of our shareholders.”

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