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CES 2022

SK subsidiaries form ICT alliance

Integrating semiconductor business into ICT sector, aims for $835 mn investment

By Jan 09, 2022 (Gmt+09:00)

SK Telecom showcases environmentally friendly ICT technology during CES 2022
SK Telecom showcases environmentally friendly ICT technology during CES 2022

South Korea’s third-largest chaebol, SK Group, announced its plans to launch a consultative body to create synergy among its three subsidiaries, namely SK Telecom Co., SK Square Co., and SK Hynix Inc. 

SK Hynix Vice Chairman and Co-CEO Park Jung-ho held a press conference on Saturday Korea time, on the sidelines of CES 2022 in Las Vegas. The SK Hynix executive shared his vision of creating a fund worth 1 trillion won ($835 million) to grow the trio with a focus on information and communications technology.

Through the initiative, SK Telecom and SK Hynix will strengthen their partnerships with corporate investors and be entitled to exclusive benefits when acquiring businesses in this sector. SK Square, which focuses on new investments in semiconductors and information and communications technologies, also aims to improve its corporate value through the alliance. 

SAPEON, INC. 

SK Telecom separated its AI semiconductor business and established an independent corporation last Tuesday. SAPEON Inc. is the initiative’s first joint project to enter the global AI semiconductor market. 

SK Hynix will promote synergy between the memory and AI semiconductor businesses. SK Telecom will lead SAPEON’s technological development on the back of its research and development expertise in the 5G and AI sectors. The telecom giant will expand its SAPEON model lineup in the long term, especially for use in data centers and self-driving vehicles. 

“To build a memory chip that goes beyond the standardized use of semiconductors, we must work together with AI memory chip makers like SAPEON Inc.,” said SK Hynix Co-CEO Lee Seok-hee.

Lee went on to say the choice of location is part of its “Inside America strategy.” 

SAPEON Inc., incorporated in the United States, eyes global tech juggernauts as its clients. The business outpost was chosen with the aim of recruiting developers in the US -- and with proximity to foreign investors in mind.  

Since 2017, SK Telecom has been working toward developing its own AI chips. Armed with its homegrown AI technology and data centers, the ICT initiative insiders explained that the project has a clear competitive edge.

The three-part collaboration will continue its investment beyond the semiconductor ecosystem to delve into the metaverse and blockchain businesses. SK Telecom CEO Yoo Young-sang said, “This year will be the first of 10 years of success for SK ICT collaboration by adapting swiftly to technological innovations in AI, metaverse, blockchain, and 5G.” 

SK Telecom's SAPEON X220
SK Telecom's SAPEON X220

ON INTEL NAND ACQUISITION & QUALCOMM MEETING

During the press conference, SK Hynix also shared the latest on its $9 billion acquisition of Intel Corp’s NAND and SSD (solid-state drive) business announced in 2020.

SK Hynix chief Lee said, “The merger and acquisition was completed late last month and we have had time to look into the organization since then.”

Lee added he had gained confidence in the 1,500 US engineers’ capabilities and thus believed the purchasing price was worth it.

SK Hynix received merger clearance from the Chinese antitrust authority for the acquisition last month, clearing the final hurdle to completion of securing regulatory approval in eight jurisdictions. Previously, the company received the green light from watchdog agencies in South Korea, the US, the European Union, Taiwan, Brazil, Britain and Singapore. Lee described Beijing’s conditions for the acquisition as “acceptable” and not out of the ordinary. 

The chief executives also touched upon their meetings with Qualcomm CEO Cristiano Amon.

SK Hynix Vice Chairman Park Jung-ho said they discussed cooperation in their memory chip business, including co-developing high-performance chips used in data centers and computers. Park added collaboration in the AI semiconductor industry is also possible as Qualcomm develops AI accelerators.

Write to Min-ki Koo at kook@hankyung.com

Jee Abbey Lee edited this article.
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