SK Innovation will absorb its battery separator subsidiary SK IE Technology, bringing the business back under direct control five years after the company was spun off and later went public. The two companies announced that their boards approved the merger on Tuesday, saying the deal is intended to strengthen SKIET’s financial stability, streamline operations and improve the long-term competitiveness of the separator business.
Under the terms of the transaction, SK Innovation will remain the surviving company and issue new shares to SKIET shareholders. Each common share of SKIET will be exchanged for 0.117 SK Innovation share, with the ratio calculated from the companies’ recent market prices in line with Korea’s capital markets law. SK Innovation’s board and SKIET shareholders are scheduled to vote on the merger on Nov. 24. The merger is set to take effect on Jan. 1, 2027, and the new SK Innovation shares are expected to list on Jan. 18.
Because the transaction qualifies as a small-scale merger for SK Innovation, its shareholders will not vote on the deal or receive appraisal rights. SKIET will proceed through the standard merger approval process.
The integration effectively reverses SK Innovation’s 2019 spinoff of its materials business. SKIET was listed in May 2021 as demand for lithium-ion battery separators rose alongside rapid growth in the global electric vehicle market. Since then, however, the business environment has weakened amid slower EV growth, delayed demand recovery in North America and increasing price competition from Chinese manufacturers.
SK Innovation said the downturn has limited SKIET’s ability to improve profitability, generate cash, and raise capital independently, making integration a more practical option than continuing as a separate company. After the merger, the company plans to cut overlapping expenses and financing costs, combine its research capabilities with SKIET’s product development expertise and look for growth opportunities, including separators for energy storage systems.
Source: The Korea Herald
