SK Innovation to Sell Stake in Lubricant Affiliate for 1.1 tln Won | Be Korea-savvy

SK Innovation Co.’s electric vehicle battery plant under construction in the U.S. state of Georgia is seen in this photo provided by the company on Aug. 28, 2020.

SEOUL, April 28 (Korea Bizwire) — SK Innovation Co., a South Korean refinery-to-battery maker, said Wednesday it has struck a deal to sell its 40 percent stake in a lubricant subsidiary to a Korean private equity fund for 1.1 trillion won (US$987 million) as it is seeking to secure funds for its battery business.

SK Innovation signed a stock purchase agreement with IMM Credit Solution to sell the stake in SK Lubricants Co., the world’s largest premium lubricant maker.

The stake sale comes as SK Innovation is trying to secure funds to shift its focus from its mainstay refinery business to the fast-growing EV battery business.

The company also needs additional cash after it recently agreed to pay 2 trillion won, half in cash and half in royalty, to its bigger home rival LG Energy Solution Ltd. to settle a two-year legal dispute over the EV battery technology.

As the settlement nullified the International Trade Commission’s 10-year import ban in the United States, SK Innovation vowed to open a $2.6 billion factory in Georgia, which will supply EV batteries to Ford Motor and Volkswagen.

SK Lubricants posted 3.4 trillion won in sales and 293.9 billion won in operating profit last year.

As global automakers are speeding up their transition to electric vehicles, SK Lubricants has expanded production of lube oil for EVs to diversify its product mix.