The Korea Herald

지나쌤

SK in talks to sell specialty gas unit

By Im Eun-byel

Published : Aug. 20, 2024 - 15:39

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SK Group's logo at its headquarters in central Seoul. (Newsis) SK Group's logo at its headquarters in central Seoul. (Newsis)

SK Group, the country's chip-to-energy conglomerate, is considering the sale of its gas supplier SK Specialty, amid the massive reshuffle across its affiliates to focus on future growth drivers.

The company is "considering diverse strategies, including the sale of a stake in SK specialty" but "nothing has been decided in detail yet," SK Inc. said through a regulatory filing made Tuesday.

SK Inc., the holdings company behind SK Group, owns a 100 percent stake in the gas unit.

The announcement was made following a news report that SK is considering selling SK Specialty to a private equity firm as part of the group's portfolio rebalancing.

SK Specialty, previously named SK Materials, produces special gases used in semiconductor, liquid-crystal display and solar cell manufacturing processes. Its supply of nitrogen trifluoride, a key material used for chip production, makes up 40 percent of the global consumption.

According to the report, major private equity firms based in Korea such as Hahn & Co. and MBK Partners are possible bidders for the lucrative stakes. SK Inc. is likely to remain a minority shareholder depending on the deal price.

Hahn & Co., among others, has worked closely with SK Group through various merger and acquisition deals. It has executed investments in wet bulk shipping company SK Shipping, used car retailer SK Encar, and real estate and renewable energy developer SK D&D in recent years.

Meanwhile, SK Group’s directive to restructure its portfolio to focus on future growth engines such as artificial intelligence and semiconductors has been gaining traction. The group has been working to reshuffle its subsidiaries to alleviate financial strain.

Hong Kong-based private equity fund Affinity Equity Partners announced Tuesday that it has completed the acquisition of SK Rent-a-Car, the nation's No. 2 rental car service provider under the wings of SK Group. The announcement came four months after it was named the preferred bidder in April.

It has secured a 100 percent stake in the company from SK Networks, a general trading affiliate of SK Group, at around 820 billion won ($616 million)

The equity firm said it will strengthen the business-to-consumer side of SK Rent-a-Car by providing more diverse services from rental to sales, and make the company grow into a total management brand for cars.

SK Networks said it will accelerate the transformation to an AI-based business model for growth based on stabilized financials.