SK buys power semiconductor maker for EV chip business

SK Group, South Korea’s third-largest conglomerate, has geared up its electric vehicle chip business development with the acquisition of a local power semiconductor maker to expand its presence in one of the world’s fastest-growing industries.

SK Inc. invested 120 billion won ($95 million) in Yes Powertechnix Co. to raise its stake in the silicon carbide (SiC) semiconductor producer to 95.8%, the SK Group’s holding company said on Wednesday.

In January last year, SK bought a 33.6% stake in Yes Powertechnix for 26.8 billion, helping the company develop products, upgrade manufacturing processes and find customers.

FAST-GROWING MARKET

Power semiconductors, used for current directions and power conversions, are essential for EVs, electronics and 5G communication networks. SiC power semiconductors are in the spotlight as next-generation products that can withstand about 10 times the voltage of existing semiconductors and high heat in the hundreds of degrees with 10% thickness compared with the current models.

SiC power semiconductors also improve EV energy efficiency by 7%, becoming a key component of eco-friendly vehicles. About a third of EVs around the world have been equipped with the semiconductors since Tesla Inc., the world’s top EV maker, started using them for the Model 3 in 2018.

The global SiC semiconductor market was forecast to grow to $4.9 billion in 2026, according to French market research and consulting firm Yole Developpement. It continued to raise its forecast to more than 60% of EVs expected to use the semiconductors in 2025 on growing demand for ultra-fast charging, which requires high voltages.

The world’s SiC power semiconductor market is dominated by a few companies in Germany, the US and Japan. Yes Powertechnix has the technology for the 1,700V metal–oxide–semiconductor field-effect transistor (MOSFET), a semiconductor device for high-speed switching that controls the amount of current, to compete with global leaders.

ANOTHER GROWTH OPPORTUNITY

SK plans to take the lead in localizing Yes Powertechnix’s core technologies for SiC power semiconductors through continuous research and development while enhancing its technology competitiveness with capital expenditures.

The takeover is expected to create various synergies as Yes Powertechnix can secure a stable supply of SiC wafers through SK Siltron Co., SK’s silicon wafer subsidiary given the key material of the SiC power semiconductors is facing a global supply shortage.

“SK, which has been making pre-emptive investments in core EV technologies, secured another growth opportunity in the fast-growing SiC power semiconductor market through this investment,” said Kim Yang-taek, executive vice president of SK’s Advanced Materials Investment Center.

“We will become a key EV semiconductor device company by upgrading SiC power semiconductor technology and establishing a global mass production system.”

Write to Chae-Yeon Kim at why29@hankyung.com
Jongwoo Cheon edited this article.