In the Era of Future Electrification, Aiming to Become a Total Energy Company
Targeting 20 Trillion Won in EBITDA by 2030
SK Innovation to Secure 8 Trillion Won in Capital Within This Year
SK Innovation has resolved to merge its electric vehicle battery subsidiary, SK On, with SK Enmove, a company specializing in lubricants and immersion cooling, and to carry out a large-scale capital increase. Based on this business and financial structure rebalancing, SK Innovation aims to become a total energy company with top-tier competitiveness in the era of future electrification.
On July 30, SK Innovation, SK On, and SK Enmove held the "2025 SK Innovation Corporate Value Enhancement Strategy Briefing" at the SK Seorin Building in Jongno-gu, Seoul. At the briefing, they announced the merger of SK On and SK Enmove, a resolution for a third-party paid-in capital increase, and their goal to achieve 20 trillion won in EBITDA by 2030. The briefing was attended by key executives including Jang Yongho, President of SK Innovation; Lee Seokhee, President of SK On; Choo Hyungwook, CEO and President of SK Innovation; and Kim Wonki, President of SK Enmove.
On the 30th, at the '2025 SK Innovation Corporate Value Enhancement Strategy Briefing' held at the SK Seorin Building in Jongno-gu, Seoul, Yongho Jang, President of SK Innovation, is explaining SK Innovation's future strategy. SK Innovation
SK On and SK Enmove Merger to Secure Electrification Business Competitiveness and Accelerate Growth
SK Innovation is pursuing the merger of SK On and SK Enmove to secure competitiveness and accelerate growth in the electrification business, which is a core growth engine for the future. Through this merger, the synergy generated by combining the customer bases and businesses of both companies is expected to create additional revenue and further strengthen financial soundness.
As a result of this merger, SK On is expected to see an immediate improvement in its financial structure this year, with 1.7 trillion won in capital and 800 billion won in EBITDA. SK Innovation forecasts that business synergy will lead to the creation of more than 200 billion won in additional EBITDA by 2030.
Specifically, in key business areas such as SK On's electric vehicle (EV) batteries and energy storage system (ESS) batteries, and SK Enmove's base oil, lubricants, immersion cooling, and EV air conditioning refrigerants, the companies expect to increase profits by leveraging their shared customer base and cross-selling products. In addition, new market entry and business expansion are anticipated, such as the launch of package businesses combining immersion cooling and batteries.
SK On aims to enhance corporate value by achieving stable growth and financial soundness based on this profitability, with a strategic goal of generating over 10 trillion won in EBITDA and reducing its debt ratio to below 100% by 2030.
President Lee stated, "As we expect significant synergy from combining the technological and business capabilities of the two companies, we will demonstrate even greater competitiveness in the global market going forward."
SK Innovation to Achieve Top-Tier Financial Soundness Through Large-Scale Capital Increase and Asset Optimization
SK Innovation will proactively strengthen its financial soundness by significantly reducing net debt through a large-scale capital increase.
First, SK Innovation plans to raise a total of 8 trillion won in capital this year. This includes a 2 trillion won third-party paid-in capital increase by SK Innovation, the issuance of 700 billion won in perpetual bonds, a 2 trillion won third-party paid-in capital increase by SK On, and a 300 billion won paid-in capital increase by SK IE Technology (SKIET), totaling 5 trillion won in capital raising. In addition, SK Innovation announced plans to secure an additional 3 trillion won in capital by the end of this year.
SK Inc. will directly invest 400 billion won in SK Innovation's 2 trillion won capital increase and will enter into a price return swap (PRS) agreement for the 1.6 trillion won third-party paid-in capital increase, which involves participation from multiple financial institutions.
An SK Inc. representative stated, "At this critical point of transitioning SK Innovation's portfolio toward the future, we participated in the capital increase to secure financial stability and accelerate profit and growth. By enhancing the value of SK Innovation, a core subsidiary of SK Inc., we can ultimately maximize the long-term interests of all holding company shareholders."
SK Innovation will also enter into PRS agreements for SK On's 2 trillion won and SKIET's 300 billion won capital increases, which also involve financial institutions. Both companies plan to use these funds as operating capital.
PRS is a derivative product in which profits or losses are settled based on stock price fluctuations after investment by financial institutions. This allows for the efficient use of external investment funds and reduces the outflow of company resources.
SK Innovation has decided to purchase all of the convertible preferred shares in SK On held by financial investors (FI) for 3.588 trillion won. Earlier this month, SK Innovation also purchased all 12 million shares of SK Enmove held by FI.
At the same time, SK Innovation will begin comprehensive asset optimization. The company plans to reduce borrowings by more than 1.5 trillion won within this year through the sale and liquidation of non-core assets.
This capital increase and asset optimization are expected to reduce SK Innovation's net debt by more than 9.5 trillion won this year.
President Jang stated, "Through this two-pronged portfolio rebalancing of business and financial structures, we will improve EBITDA and reduce net debt to achieve top-tier financial soundness in Korea."
On the 30th, the '2025 SK Innovation Corporate Value Enhancement Strategy Briefing' was held at the SK Seorin Building in Jongno-gu, Seoul. From the left, Hyungwook Chu, CEO of SK Innovation; Yongho Jang, President of SK Innovation; Seokhee Lee, President of SK On; and Wonki Kim, President of SK Enmove. SK Innovation
SK Innovation to Achieve 20 Trillion Won EBITDA and Maintain Net Debt Below 20 Trillion Won by 2030
Since last year, SK Innovation has been actively pursuing portfolio rebalancing focused on business and financial structure improvements as two pillars of structural innovation for sustainable growth across its affiliates.
In November last year, SK Innovation merged with SK E&S, and from November last year to February this year, SK On implemented business structure rebalancing by merging with SK Trading International and SK Entum. As a result, SK Innovation has completed an integrated energy portfolio by adding the liquefied natural gas (LNG) value chain to its existing oil and battery businesses.
Additionally, by strengthening EBITDA, the company has enhanced its profit-generation capability and mitigated profit and loss volatility. The company also improved its financial structure through capital increases. Last year, SK Innovation reduced its net debt by about 600 billion won without impairing EBITDA. SK On is reaping the benefits of business synergy and a strengthened financial base, such as securing raw material sourcing capabilities.
With the planned merger between SK On and SK Enmove, the company is now seen as having established a business structure with sustainable competitiveness and a financial structure that supports stable future growth.
SK Innovation's strategy is to become the most competitive total energy company in the era of future electrification by 2030, focusing on core businesses such as oil and chemicals, LNG and power, batteries, and energy solutions. In particular, the company aims to concentrate its capabilities on increasing profit-generation and securing stable financial soundness, with the goal of achieving 20 trillion won in EBITDA and maintaining net debt below 20 trillion won by 2030.
President Jang stated, "SK Innovation will be reborn as a company with both profitability and growth potential based on a stable financial structure. Through this, we will enhance corporate value and actively expand shareholder returns."
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