SK Group weighs 11Street repurchase amid investor pressure

SK Group is considering repurchasing a stake in e-commerce platform 11Street after initial attempts to sell the asset fell through, increasing pressure from major investors like the National Pension Service (NPS).

The group initially held a call option—an agreement allowing it to buy back shares at a preset price—but opted not to exercise this right last year. Since then, H&Q Korea, one of 11Street’s financial investors, has struggled to find a buyer for its stake. SK Group is now considering a repurchase to support NPS and other investors.

11Street’s largest financial backers include NPS, H&Q Korea, and MG Community Credit Cooperative, with NPS holding a significant stake. Analysts view SK’s repurchase consideration as an effort to restore credibility with these investors amid concerns about the group’s standing in capital markets.

The group faces financial strain as another subsidiary, SK On, manages substantial debt and seeks additional capital. SK On previously secured billions in investments with similar call option terms, which require it to buy back shares if the company fails to go public by 2026. SK Group’s potential repurchase of 11Street is made weightier by these ongoing pressures.

11Street logo./11Street

If SK Group moves forward with the repurchase, it could avoid the previous price tag of 550 billion won ($460 million) set for the 18.18% stake in 2022. However, market analysts caution that any cost savings remain uncertain, and SK could still face a hefty financial burden.

SK On, meanwhile, is bound by similar “call and drag” clauses with financial backers like the Korea Investment Private Equity consortium and MBK Partners. Should SK On miss its public listing deadline, these investors could seek to sell off their stakes through a drag-along right, compounding SK Group’s financial challenges.

Industry experts suggest SK’s decision will hinge on its ability to rebuild investor trust. “There’s no easy path forward for SK with both NPS and SK On weighing in,” a source close to the matter said. “Restoring confidence in SK’s handling of capital is the top priority.”