SK Innovation considering sale of battery materials unit SKIET, paper reports

By Thomson Reuters May 15, 2024 | 6:32 AM

SEOUL (Reuters) – South Korea’s SK Innovation is considering selling its subsidiary SK IE Technology (SKIET) to restructure its battery business, the Maeil Business newspaper reported on Wednesday.

The move is aimed at easing financial difficulty faced by SK Innovation’s battery-making unit SK On amid weakening demand for electric vehicles, according to the newspaper, citing an unnamed investment banking source.

SKIET supplies separators – an essential battery component – to EV battery makers including Tesla partner Panasonic Corp.

The report added that SK Group has recently decided on a plan to sell SKIET’s management rights and began contacting potential buyers through major global investment banks.

SK Innovation owns a stake of 61.2% in SKIET, whose market value stood at 4.09 trillion won ($3.01 billion) as of Tuesday.

An SK Innovation official said nothing has been decided, in response to Reuters’ request for comment.

SK On, whose clients include Ford Motor, Volkswagen and Hyundai Motor, widened its operating loss to 332 billion won in the first quarter from 18.6 billion won a quarter before as EV battery shipments fell. However, it maintained its target to break even in the second half.

($1 = 1,358.8300 won)

(Reporting by Heekyong Yang and Jihoon Lee; Editing by Alison Williams)