SK Innovation’s Merged Entity Officially Launches, Setting Sail as the Largest Private Energy Company in Asia-Pacific

• Completed the merger process with SK E&S over the past three months, officially launching a merged entity with assets totaling KRW 105 trillion
• Established a comprehensive portfolio encompassing current and future energy sectors, including oil, chemicals, LNG, power, and batteries
• Formed an Integration Synergy Task Force and Energy Solutions Business Division to drive synergies and ensure future growth potential

SK Innovation and SK E&S have officially completed their merger, launching a new entity on November 1. Following the announcement in July, the companies have successfully concluded the preparation process over the last three months, creating the largest private comprehensive energy company in the Asia-Pacific region, with assets totaling KRW 105 trillion as of the first half of this year.

On the same day, SK Innovation’s Board of Directors finalized the merger procedures with its subsidiaries, SK On and SK Trading International. The company plans to complete the merger with SK Enterm by February 1 next year.

With this strategic move, SK Innovation aims to establish a robust portfolio that encompasses both current and future energy sectors, including petroleum energy, chemicals, LNG, power, batteries, and renewable energy. The company is set to evolve into a “Total Energy & Solution Company,” integrating technologies and capabilities across each portfolio to provide comprehensive energy solutions.

Building a Distinctive and Competitive Portfolio as a Leading Comprehensive Energy Corporation

SK Innovation is earning commendations for its establishment of a distinctive and robust portfolio as a leading global comprehensive energy corporation. The recent merger has strategically positioned SK Innovation to not only enhance its competitiveness in primary energy sectors such as petroleum, gas, and power but also to expand its operations into the energy infrastructure domain, including the burgeoning battery segment.

Typically, global private energy companies with assets exceeding KRW 100 trillion tend to focus on either petroleum or power. However, the newly formed SK Innovation distinguishes itself with a balanced and substantial presence across all three major sectors—petroleum, power, and gas—demonstrating significant market engagement. Industry analysts highlight that this strategic positioning offers a promising future vision and substantial potential for sustainable growth.

To support its evolution into a comprehensive energy enterprise, SK Innovation has optimized its organizational structure. SK E&S will operate under the new name “SK Innovation E&S” as a Company-in-Company (CIC). CIC is a structure that allows business units to operate independently within a larger organization, enhancing agility and innovation while utilizing shared resources. This approach helps preserve the competitive edge of its legacy business operations while fostering synergies with SK Innovation’s existing businesses.

Similarly, SK On will integrate the newly merged SK Trading International under the name “SK On Trading International,” also functioning as a CIC. This strategic move aims to bolster the company’s competitiveness in securing battery raw materials, enhance financial stability, and further strengthen its core business capabilities.

Establishing New Divisions to Leverage Merger Synergies and Embark on Concrete Business Development

Following the merger announcement in July, SK Innovation has accelerated its efforts to create business synergies by launching the “Integration Synergy Task Force.” This task force has identified four core “Quick-Win” business areas—LNG value chain, trading, hydrogen, and renewable energy—and has begun concrete business realization efforts.

The company is currently exploring the establishment of self-generation facilities within the SK Ulsan Complex (CLX) and the direct import of LNG. These initiatives are expected to enhance power production and supply stability while delivering cost savings. Additionally, SK Innovation is advancing a project to directly secure and utilize condensate* extracted from the Barossa Caldita (CB) gas field in Australia, developed by SK Innovation E&S. This initiative aims to strengthen SK Innovation’s product sales competitiveness in the international crude oil market and improve operational efficiency.
*Condensate: A volatile liquid hydrocarbon that is produced as a byproduct during natural gas extraction.

Collaboration between the recently established “Energy Solution Business Division” at SK Innovation and the ongoing energy solutions business managed by SK Innovation E&S is also anticipated. The energy solutions business is designed to offer customized solutions for customers, enhancing energy supply stability, cost savings, and carbon reduction. The division focuses on optimizing power supply for SK Group affiliates and providing total energy solutions to AI data centers, among other initiatives. Furthermore, SK Innovation plans to leverage its research and development (R&D) capabilities to continuously expand into businesses such as Small Modular Reactors (SMR) and Energy Storage Systems (ESS).

Creating Greater Value for All Stakeholders and Contributing to the National Economy

SK Innovation expressed gratitude to all stakeholders, including shareholders, customers, partners, government agencies, and the public, who supported the merger that laid the foundation for sustainable growth. As a leading company in the Korean energy industry, SK Innovation reaffirmed its commitment to maximizing shareholder value and contributing to the development of the national economy.

On this occasion, SK Innovation President & CEO Park Sang-kyu sent an email letter to employees, stating, “This merger enables us to establish a balanced energy portfolio and envision greater future growth.” He encouraged everyone to “expand our customer base and market presence through business synergies.”

CEO Park further called upon everyone, “Let us all, as one team, embody the passion and SUPEX spirit of the SK Management System (SKMS) to collectively build the history of SK Innovation’s stability and growth.”

Choo Hyeong-wook, President of SK Innovation E&S, also shared his vision for the merged entity, stating, “Through the independent CIC structure, we will maintain the competitiveness of our existing businesses while creating merger synergies to enhance both stability and growth potential.” He added, “By combining various energy sources and business and technology capabilities of the merged entity, we aim to provide Energy Solution Packages tailored to customer and regional characteristics and lead innovation in the energy industry.”