SK On Announces a Three-Way Merger
SK On Announces a Three-Way Merger

SK On Announces a Three-Way Merger

  • 06-Feb-2025 2:30 PM
  • Journalist: Alexander Hamilton

SK On, a leading global electric vehicle (EV) battery manufacturer and an arm of South Korea's SK Group, has announced the successful completion of a significant three-way merger. The merger, finalized on February 1, integrates SK Enterm and follows the previous merger with SK Trading International last November, solidifying SK On's position as a "global battery & trading company."

The newly merged entity will operate under the SK On name, with SK Trading International continuing its operations as a company-in-company (CIC) under the name “SK On Trading International,” and SK Enterm, South Korea’s largest commercial tank terminal operator, functioning within this CIC.

This consolidation is designed to create powerful synergies, enhance raw material sourcing capabilities, bolster financial stability, and drive sustainable growth in the increasingly competitive EV battery market.

The merger is expected to significantly strengthen SK On's core competitiveness in the battery business. By integrating SK Trading International's extensive trading expertise and global network, SK On gains access to enhanced raw material sourcing. This access not only streamlines the supply chain but also mitigates market risks, such as price volatility and trading-related uncertainties.

SK On's projected revenue is expected to surge from 13 trillion won to 62 trillion won, while assets are forecast to grow from 33 trillion won to 40 trillion won (based on end-2023 figures). Critically, the merger is anticipated to add approximately 500 billion won in EBITDA. This enhanced profitability will enable SK On to invest further in portfolio diversification, manufacturing advancements, and crucial research and development.

The trading business itself is poised for expansion. SK On Trading International can now diversify its portfolio beyond petroleum-based trading to include essential battery metals and materials like lithium, nickel, and cobalt. This diversification will enhance profitability and position SK On as a key player in the burgeoning battery materials market. The combined expertise and infrastructure will allow for more efficient and profitable trading operations.

“Through this merger, we aim to build a foundation for long-term growth by creating synergies and securing a distinct competitive edge,” a spokesperson for SK On stated. “SK On will evolve into a global battery and trading company, balancing growth potential with stability.” This strategic move positions SK On not just as a leading battery manufacturer, but as a comprehensive player in the energy landscape, equipped to navigate the complexities of the global market and drive the future of sustainable mobility.

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