[Funding] SK PIC Global, First Fundraising in Domestic Capital Market

[Asia Economy Reporter Lim Jeong-su] SKC and Kuwait's PIC (Petrochemical Industries Company) global joint venture, SK PIC Global, raised funds in the domestic capital market for the first time since its establishment.

According to the investment banking (IB) industry on the 22nd, SK PIC Global secured 100 billion KRW in funds under the lead of Woori Bank. Woori Bank executed a 3-year maturity loan to SK PIC Global through a special purpose company (SPC) and secured loan funds by selling securitized bonds backed by the loan principal and interest to institutional investors.

SK PIC Global was established when SKC spun off its chemical business division earlier this year and transferred 49% of its shares to PIC. Currently, SKC and PIC hold shares at a ratio of 51 to 49. The joint venture’s corporate value amounts to a total of 1.195 billion USD (1.45 trillion KRW). The initial capital is 10 billion KRW.

Earlier this year, SKC appointed Won Gi-don, former head of SKC’s chemical business division, as CEO of SK PIC Global. Besides CEO Won, SKC CEO Lee Wan-jae and Kim Jong-woo, head of SKC’s Business Model (BM) Innovation Promotion Group, serve as concurrent registered executives. On the PIC side, Mohammad Al-Suri and Shafiti Al-Amisi were appointed as board members.

SK PIC Global’s fundraising is expected to continue as investment and operating capital needs are anticipated to increase while expanding the chemical business. SK PIC Global aims to invest in high value-added PO (polyolefin) and simultaneously establish a global PO production capacity of 1 million tons.

On the other hand, it is unlikely that the parent company SKC will provide financial support. SKC plans to invest the funds raised through the chemical business spin-off and the sale of SKC Kolon PI shares into new businesses such as mobility, semiconductors, displays, and eco-friendly sectors. An IB industry official said, “As SKC innovates the group’s BM, investments in new businesses will increase,” adding, “SK PIC Global will increase its own fundraising.”