Decides to Participate in SK On's Pre-IPO
The Qatar Investment Authority (QIA) is betting big on SK On, which has recently announced a successful attraction of 1.3 trillion won in investment from domestic and foreign investors through a pre-IPO.
QIA has US$450 billion worth of assets under management. Its investment capability has sharply increased recently, thanks to soaring gas prices. It has built a strong business relationship with SK Innovation, the parent company of SK On. It acquired 36.49 percent of preferred stocks of Turkey’s Eurasia Undersea Tunnel from SK Gas for 143.1 billion won.
Qatar is known to be seeking various investment opportunities and has selected electric vehicle batteries as one of its major future growth drivers. The Qatar Investment Authority will reportedly inject a total of 650 billion won into SK On by the first quarter of next year together with foreign investors such as Hill House Capital, a Chinese private equity fund. Hill House Capital is also a big investor that has drawn attention for its bold investments in global companies with high growth potential. With US$50 billion under management, the Chinese PE fund is known to be one of the early investors in Market Kurly.
“Sovereign wealth funds like the Qatar Investment Authority are long-term investors compared to general private equity funds,” said an IB industry insider. “They are preferred by growth-oriented companies. Hill House is also rich in funds, which will be of great help to SK On attracting additional investment.”
SK On plans to secure additional funds of up to 2 trillion won by conducting a second pre-IPO in 2023.
East Bridge Partners, a Korean private equity fund, is also known to have played a role in SK On’s attraction of foreign investment. From the beginning of its establishment, East Bridge Partners has built trust by attracting funds from Middle Eastern institutional investors.
Korea Investment Holdings will take the lead in attracting the remaining 650 billion won from domestic investors. The group's affiliates, including Korea Investment & Securities, Korea Investment Capital, and Korea Investment Private Equity (PE) will participate in the investment.
In addition, if the interest rate is stabilized next year, institutional investors such as Carlyle Group, MBK Partners and domestic mutual aid associations are highly likely to promote equity investments in SK On. These potential investors had considered making investment in SK On, but did not take part in the pre-IPO.