South Korean battery maker SK On Co. has secured US$944 million from investors in a round of funding in preparation for an initial public offering (IPO), its parent company said Wednesday.
The board of SK Innovation Co. approved the equity investment agreement it and SK On signed with a consortium of financial investors, led by private equity fund MBK Partners, under which the battery maker will receive $800 million in funding, SK Innovation said.
SNB Capital, a subsidiary of Saudi National Bank (SNB), will also chip in $144 million.
The latest funding adds to the 3.2 trillion won (US$2.43 billion) SK On has secured from SK Innovation and other investors. That raises the total funding SK On has secured so far to 4.4 trillion won.
The round of funding will help SK On, the battery split-off of SK Innovation, accelerate efforts to pool financial resources before it launches the process for its market debut.
SK Innovation said earlier it is preparing for the IPO, but it won't take place for another couple of years.
In a separate filing, SK Innovation said it will provide debt guarantees for SK On's 2 trillion-won loan from Hyundai Motor Co. and Kia Corp.
SK On and Hyundai Motor are building a 6.5 trillion-won electric vehicle battery plant in the U.S. state of Georgia.
SK On has remained in the red and is aiming for a turnaround amid an aggressive overseas push. It is targeting an increase in its annual production capacity to 220 gigawatt hours (GWh) by 2025, from 88 GWh in 2022.
Source: Yonhap News Agency