SK Innovation Advances as Board Set to Discuss Possible Merger
By Kwanwoo Jun
SK Innovation's shares climbed as its board was set to discuss a possible merger with a profitable sibling company to create a new energy giant in South Korea.
Shares of the South Korean oil-refining and battery company rose as much as 8.7% to 123,200 won early Wednesday, outperforming the benchmark Kospi's 0.3% fall.
The share-price rally came as the boards of SK Innovation and renewable-energy company SK E&S, both affiliates of conglomerate SK Group, were due to meet later in the day to decide on a possible merger.
A merger would create the country's biggest energy company, with more than KRW100 trillion ($72.27 billion) in combined assets.
An SK Innovation official said details would be available only if the boards make "a meaningful decision" after Wednesday's meeting. He declined to elaborate.
SK Innovation and SK E&S aim to complete the merger by November, with SK Corp., a holding company of the business conglomerate, also due to hold a board meeting on the merger on Thursday, according to South Korean media reports.
Some market analysts said the merger could help SK Innovation, which owns unprofitable battery affiliate SK On, improve its balance sheet.
SK E&S, controlled by SK Corp., profits from trade in natural-gas and renewable-energy sources, analysts said.
Write to Kwanwoo Jun at kwanwoo.jun@wsj.com
(END) Dow Jones Newswires
July 17, 2024 01:55 ET (05:55 GMT)
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