SK Square chief expects significant investment gains from next year

SK Square Co., the investment management arm of South Korea’s SK Group, is looking to reap handsome gains from its investment and divestment activities starting next year.

At this year’s SK Tech Summit held in Seoul on Monday, SK Square Vice Chairman and Chief Executive Park Jung-ho said the company plans a share buyback to enhance shareholder value soon after its annual general meeting in February next year.

“Our first investment and divestment cycle will be complete early next year, when you can see our company’s investment management capabilities,” he said at the annual event.

Spun off from Korea’s largest mobile carrier SK Telecom Co. last November, SK Square is SK Group’s intermediate holding company that is essentially an investment firm seeking new opportunities in non-telecom sectors.

Currently managing close to 20 portfolio corporates, SK Square is expected to realize some capital gains via divestments and then invest in new target firms.

It has invested in various promising business sectors, including the metaverse, agricultural technology and cryptocurrency.

In July, the company sold all of its shares in Korean biotech NanoEntek Inc., a 28.4% stake, for 58 billion won ($44.3 million), marking its first divestment since its November split-off.

EQT PARTNER’S SK SHIELDUS DEAL TO BEAR FRUIT SOON

More recently, Park said, SK Square stands to gain profit from Swedish investment giant EQT Partners AB’s move to acquire a controlling stake in SK Shieldus Co.

EQT Partners, under the umbrella of Europe’s Wallenberg family dynasty, is slated to invest more than 2 trillion won in SK Shieldus, which is valued at as high as 5 trillion won.

Separately, EQT Partners is in talks to acquire SK Shieldus shares from SK Square to eventually become the largest shareholder of SK Shieldus, a security service provider formerly known as ADT Caps.

Regarding SK’s e-commerce platform 11Street, which began an initial public offering (IPO) process in April, Park said he may seek to forge a business tie-up with global e-commerce players if its fundraising plan doesn’t work out well.

SK Group has sought to attract as much as 300 billion won in investment for 11Street from Amazon.com, the world's largest online retailer, but little progress has been made.

Park said SK Square plans to buy back its treasury shares from the market to boost its share price in February next year when the company’s full-year financial results are due.

Shares of SK Square were trading 1.2% higher at 39,000 won in the early Wednesday session, in line with the broader Kospi market’s 1% rise.

The company’s stock was hovering around 80,000 won apiece soon after its separation from SK Telecom in November last year.

Write to Han-Gyeol Seon and Sang-eun Lucia Lee at always@hankyung.com
In-Soo Nam edited this article.