SK Ecoplant to build largest commercial data center in Korea

South Korea’s SK Ecoplant Co., formerly known as SK Engineering & Construction Co., is slated to develop the largest commercial data center in Korea. The construction unit of conglomerate SK Group will participate in all the stages of engineering, procurement and construction.

SK Ecoplant and Singapore-headquartered Digital Edge on April 22 signed an agreement to found a joint venture to develop a data center in Incheon City. Founded in 2000, Digital Edge is a data center company focusing on high-growth markets in the Asia-Pacific region. In April 2021, it announced its initial entry into the Korean market with acquisitions of Korean telecom company Sejong Telecom Inc.’s data center assets, in Seoul and Busan, for $120 million. Digital Edge is operating data centers in Korea, Japan, Indonesia and the Philippines.  

Under the agreement, SK Ecoplant and Digital Edge will jointly develop two buildings of a data center with 120 megawatts in Incheon's Bupyeong National Industrial Complex. The project will cost more than 1 trillion won ($800.3 million), SK Ecoplant said. The firms will kick off construction of one of the two buildings this year and complete it in 2024. 

SK Ecoplant is set to grow as a data center developer in earnest by expanding its expertise from construction to engineering and procurement. Digital Edge will focus on building and operating the new data centers in Korea.

SK Ecoplant, the major cash flow of which comes from residential building construction, founded a smart data center division in 2020 to diversify its business. The firm is planning to build green data centers by introducing eco-friendly technology to electric power system operations.

Formerly SK E&C, SK Ecoplant was renamed in May 2021 as part of shifting its identity to an environmentally friendly company. It acquired Korea’s largest waste treatment company EMC Holdings Co. for 1 trillion won in 2020 and bought Singapore-based electronic waste disposal and recycling company TES-Envirocorp Pte for 1.2 trillion won in February of this year. 

Its pre-IPO has reached 800 billion won, set to sell 600 billion won worth of newly issued convertible preferred stocks (CPS) and 200 billion won worth of shares owned by its chemical affiliate SK Discovery Co. The weighted average price per share is calculated as 94,700 won, and the corporate value after the pre-IPO is estimated to be 4 trillion won.

Write to Jong-Pil Park at jp@hankyung.com
Jihyun Kim edited this article.