"1-2 Years of Focused Investment in Semiconductor and Battery Materials"… SK Materials and SK Co. Merger Approved at General Meeting

by Choi Daeyul

Published 29 Oct.2021 16:19(KST)

Lee Yong-wook, President of SK Materials, is speaking at the extraordinary general meeting of shareholders held on the 29th.

[Asia Economy Reporter Choi Dae-yeol] Semiconductor materials specialist SK Materials announced on the 29th that both the approval of the spin-off plan and the approval of the merger agreement were passed at the extraordinary general meeting of shareholders held on the same day. Accordingly, the entire specialty gases business division will be spun off to create a new corporation, and at the same time, the remaining holding company business division will merge with SK Inc., the group’s holding company. The merger process is expected to be completed in early December.

The two companies decided on this merger due to the need for continuous investment and advancement of management strategies in the global advanced materials market. The company emphasized that the next one to two years will be crucial, as proactively seeking investment opportunities in high-growth areas such as semiconductors, displays, and batteries is expected to be a key factor in determining market dynamics. The strategy is to organically combine SK’s investment capabilities with Materials’ material technology commercialization capabilities to grow the company.

Earlier, SK Inc. announced a goal to invest 5.1 trillion KRW in the advanced materials sector by 2025 to become the world’s number one semiconductor and battery materials company. The newly established specialty gases company currently has products with a high global market share, and plans to increase the range of high value-added products tailored to semiconductor customers. The SK Materials holding business division will operate as a company-in-company (CIC) within the merged company, expanding the materials business and managing related subsidiaries.

SK Inc. will absorb and merge SK Materials through a small-scale merger by issuing new shares in exchange for SK Materials stock. From November 29 to December 24, trading of SK Materials shares will be suspended, and around the 27th, SK Inc. common shares will be issued at a ratio of 1.58 shares per one SK Materials common share. Lee Yong-wook, CEO of SK Materials, said, "This is an essential choice to leap forward as a global top materials company, and we will enhance shareholder value."