SK On to raise $2.2 billion in a rights offering

SK On, a battery subsidiary of SK Innovation, will raise 2.8 trillion ($2.2 billion) through a rights offering, according to the parent company’s regulatory filing Wednesday.

SK On, a battery subsidiary of SK Innovation, will raise 2.8 trillion ($2.2 billion) through a rights offering, according to the parent company’s regulatory filing Wednesday.

SK Innovation will provide 2 trillion won, and the rest will be from financial investors, including Korea Investment Private Equity. The private equity firms (PEFs) may invest an additional 500 billion won next year, the company added.

SK On plans to spend the money on production capacity amid rising electric vehicle demand worldwide.

SK On will sell 36.4 million shares, worth 2 trillion won, to SK Innovation and 14.8 million shares, worth 824.3 billion won, to six local PEFs, including Korea Investment Private Equity.

SK Innovation will make the first 1 trillion won investment before the end of this month, with the remainder to be proceeded next year.

The funds will be used to help SK On, which was split off from SK Innovation in October last year, accelerate its push for an expansion in the global battery market amid the rapid electrification trend.

SK Innovation CEO Kim Jun said earlier this year the IPO was not likely to take place until after 2025.

BY SHIN HA-NEE, YONHAP [shin.hanee@joongang.co.kr]