This file photo, provided by SK Innovation Co. on Sept. 25, 2021, shows its CEO and vice chairman, Kim Jun.
SEOUL, March 31 (Korea Bizwire) — SK On Co. is not considering an initial public offering (IPO) for at least another two to three years but will build up its competitiveness and enhance corporate value before pushing for a market debut, head of its parent company said Thursday.
The potential listing of SK On has drawn attention since the battery unit was spun off from SK Innovation in October last year, as part of SK’s push to bolster the battery business amid growing demand from global automakers vying for a bigger share in the electric vehicle market.
“What’s the most important for an IPO to take place is that we need to have our battery business recognized in the market,” Kim Jun, CEO and vice chairman of SK Innovation Co., told reporters after a general shareholders meeting.
“I expect that we should be able to deliver the performance, in terms of sales, profitability and stable management of equipment, after 2025, and I believe it would be after 2025 if we were to do an IPO,” he said.
Its bigger rival, LG Energy Solution Ltd., set a record IPO in January that made the battery maker the second-largest company in South Korea by market cap, reflecting the global electrification trend.
Kim said SK On is at the pre-IPO stage to raise funds from investors in advance of going public.
“We need large-scale resources as we are continuing with the facility expansion … We plan to sign the contracts (on the investments) in the first half,” Kim said.
Industry sources predict SK On is seeking to raise between 3 and 5 trillion won (US$2.47-4.12 billion), which amounts to about a 10 percent stake in the company.
Kim forecast SK On will swing to the black in the fourth quarter of this year and achieve an annual surplus from next year. SK Innovation’s battery business logged an operating loss of 683.1 billion won in the fourth quarter of last year.
In light of any possible advance into new businesses, Kim said he is looking at areas of “non-carbon, or low-carbon energy sources,” and discussing various ideas with SK Group Chairman Chey Tae-won, without elaborating further.
Earlier this month, Chey hinted at “drawing up a new business map that incorporates energy and environment” during a visit to a SK Innovation factory in a southwestern city.
(Yonhap)
