Two New Corporations to Be Launched on Oct. 1
Shareholders of SK Innovation approved on Sept. 16 the company's plan to split off its battery and oil exploration and development (E&P) businesses.
In an extraordinary meeting held at SUPEX Hall, SK Seorin Building in Seoul, shareholders also passed several agenda items, including partial amendments of statutes of the company.
SK Innovation’s board of directors has approved the spin-off of both battery and oil E&P businesses to uplift the company's corporate value and have the competitiveness and growth potential of the two units be objectively acknowledged in the market.
The two newly established corporations are tentatively named SK Battery Co., Ltd., and SK E&P Co., Ltd. and will be officially launched on Oct. 1, 2021.
In the extraordinary shareholders’ meeting, the spin-off plan was passed at a 80.2% of approval rate. Also passed include some amendments on the company's statutes, including: the introduction of corporate governance charter, modification of the names of committees under the board of directors, and establishment of a provision to allow dividends through momentary means, stocks, and other properties at the confirmation rate of 97.9%.
The shareholders' approval is likely to give momentum to SK Innovation’s vision of transitioning from 'Carbon to Green,' which was sketched out in its "Financial Story."
SK Innovation released the Financial Story on July 1, elucidating the company's commitment to transform its carbon-oriented business structure into a green one. It disclosed the spin-off plan as a means of attaining the vision and maximizing corporate value.
In particular, the swiftly burgeoning battery business has already secured more than 1,000 GWh order backlogs, which raises it to the No. 1 position in the global market. To meet the orders, the company will increase its battery production capacity from the current 40 GWh to above 200 GWh per year by 2025.
The battery business entity will be in charge of medium- to large-sized batteries, BaaS (Battery as a Service), energy storage system (ESSs), and more, whilst the oil exploration and development entity will assume oil exploration, development and production, and carbon capture and storage (CCS), respectively.
SK Innovation CEO and president Kim Jun said, "The spin-off of the two units is an inevitable decision as we need to gain the upper hand in the two business ares in the face of increasingly fierce global competition by enhancing each business's expertise and competitiveness. We will make the most out of this spin-off to expedite the qualitative and quantitative growth of our company by sharpening our competitive edge with the establishment of distinctive and customized management systems.”