SK创新股东说明会：吸收合并SKIET后暂无进一步重组，也不考虑SK On IPO

SK Innovation said it currently has no plans for additional business restructuring after absorbing SK IE Technology (SKIET), adding that it is not considering an initial public offering (IPO) of battery unit SK On. The company has continued large-scale portfolio restructuring to improve its financial structure, but said no measures beyond the SKIET merger have been decided.
SK Innovation held a meeting with shareholders on Monday to explain the background to its planned absorption merger with SKIET and its future business direction. SKIET has faced worsening earnings and financial pressure as demand for battery separators declined amid slower growth in the electric-vehicle market. As the company found it difficult to sustain the business through independent financing, SK Innovation chose to bring the separator business directly under its control.
SK Innovation has been restructuring its affiliates to improve its financial structure and business competitiveness. Shareholders asked about the possibility of additional restructuring, including the sale or merger of affiliates, after the SKIET merger.
“There are currently no plans for additional restructuring beyond the SKIET merger,” an SK Innovation official said. The company will prioritize reducing the financial burden on the separator business and restoring its competitiveness through the merger. After the merger, it will reassess the business environment and competitiveness of each operation before deciding whether to pursue further restructuring.
SKIET’s separator business is expected to face a critical two- to three-year period for a return to profitability. Although the recovery of the electric-vehicle market is taking longer than expected, the company expects to improve its loss-making structure as demand for non-China-made separators increases, particularly in North America, and the energy storage system (ESS) market expands. It also plans to improve profitability through self-help measures such as cutting production costs.
The possibility of an IPO for SK On was another focus of shareholder interest. SK On previously raised funds from financial investors (FIs) under terms that required it to pursue an IPO within a specified period. SK Innovation later reached an agreement with the FIs on the recovery of their investment, removing the IPO obligation. The company is also taking into account the government's negative stance toward dual listings of parent and subsidiary companies.
SK On’s ESS business was cited as a potential additional customer for separators. Following the merger, SK Innovation plans to combine its own synthesis, analysis and computational science capabilities with SKIET’s separator technology to lower production costs. If it secures price competitiveness, it could supply separators for ESS projects won by SK On.
Shareholders also focused on potential dilution from the merger and appraisal rights. New shares issued by SK Innovation to SKIET shareholders will amount to as much as 2.6% of SK Innovation’s existing shares outstanding. If SKIET shareholders exercise their appraisal rights, no new shares will be allocated for those shares. The actual level of dilution could therefore be lower than 2.6%.
SKIET’s appraisal rights are also linked to whether the merger proceeds. The company has set a limit of about 350 billion won. Even if appraisal requests exceed that amount, the merger will not be automatically halted. SK Innovation can continue with the merger by changing the terms of the merger agreement through its board. SKIET plans to finance the share purchases using cash on hand and short-term borrowings.
A 300 billion won price return swap (PRS) contract is also likely to be handled in connection with the appraisal rights. SK Innovation began discussions with PRS investors after announcing the merger. The company currently considers a plan under which investors exercise their appraisal rights and recover their investment to be the most likely outcome.
The companies are also discussing shareholder-return measures after the merger. SK Innovation is considering dividends and share buybacks and cancellations as options and reviewing the specific method and scale. It plans to disclose its shareholder-return policy around the end of this year or early next year.