SEOUL — In a major corporate reshuffle within South Korea's SK Group, SK Innovation Co. and SK E&S Co. have received board approval to merge, setting the stage to create the nation's largest energy company with assets totaling 106 trillion won (US$76.5 billion).
According to Yonhap News Agency, the merger was ratified during separate board meetings held on Wednesday. The new entity, resulting from the consolidation of SK Innovation, the group’s energy subholding company, and SK E&S, a leader in recycled energy, is scheduled to launch as early as November following an emergency shareholders' meeting next month.
The merger is part of SK Group's broader restructuring plans aimed at enhancing its energy division and providing more robust financial backing to its battery subsidiary, SK On Co. The combined capabilities of the two companies are expected to fortify South Korea's energy infrastructure, focusing on areas such as liquefied natural gas (LNG), hydrogen, and renewable energy.
SK Corp., the largest shareholder in both companies, will hold a subsequent meeting to finalize merger details. Currently, SK Corp. holds a 36% stake in SK Innovation and a 90% stake in SK E&S. This strategic move also includes potential future integrations involving SK Innovation’s battery operations and other energy-focused affiliates, aiming to boost competitiveness in the global energy market.