“We aim to become a total energy solutions company,” emphasized SK Innovation President Park Sang-kyu.
On the 18th, SK Innovation and SK E&S held a press conference regarding their merger at the 3rd floor of the SK Seorin Building. President Park mentioned, “The prolonged global high interest rates since 2022, geopolitical risks in the petrochemical battery business, and the slowdown in battery energy business growth are situations we need to overcome.” He also stated, “As energy companies globally transform into integrated energy companies, we reached a decision to merge for mutual synergy.”
The merger between SK Innovation and SK E&S holds significant meaning for both companies. SK Innovation has assets worth 81 trillion won, while SK E&S amounts to 19 trillion won. Together, they will reach an asset size of 100 trillion won, making them the largest private energy company in the Asia-Pacific region and establishing themselves as a global integrated energy company.
Additional synergies can also be anticipated. SK Innovation currently operates in the battery energy and petrochemical sectors. The battery business is experiencing a slowdown due to stagnation in electric vehicle sales, while the oil sector faces challenges due to global geopolitical risks. However, the merger with SK E&S will enable them to engage in all energy sectors from oil to electricity and hydrogen. This comprehensive energy approach will not only lower profit volatility but also enhance overall stability.
President Park explained the long-term plans post-merger: “The flow of energy is shifting from oil to LNG and electricity. Our clients are increasingly emphasizing carbon neutrality due to environmental issues. Through this merger, we will release a range of product services tailored to global customers’ carbon neutrality requirements. Furthermore, Innovation will elevate itself as a comprehensive energy solutions company, generating annual profits of 2 trillion won by 2030.”
Additionally, plans for mergers between SK On, SK Trading International, and SK Entum were announced. President Park elaborated on the reasons for SK On’s merger: “To maintain long-term cost competitiveness, SK On must secure nickel and lithium sourcing management. We will utilize Trading International’s capabilities to counter Chinese companies that dominate material sourcing. To overcome the current electric vehicle growth, we need a robust profit structure. SK Trading International plans to extend beyond energy and enter the mineral metal business, whereas SK On will solidify its position in the future electric vehicle market through trading and tank terminal operations.”
Lee Sang-jin daedusj@autodiary.kr