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Kentucky Gov. Andy Beshear speaks during the official announcement of Ford Motor along with SK Innovation in building two electric battery factories in Glendale, Ky., at the Kentucky State Capitol in Frankfort, Ky., on Sept. 28, 2021. SK Innovation’s battery unit SK On has been trying to raise $3.3 billion in the first half of 2022 to finance capacity expansion (Courtesy of AP, Yonhap) South Korea’s SK On Co., the world’s fifth-largest electric vehicle battery maker, is set to raise up to 1 trillion won ($822.5 million) from a consortium of local private equity firms as it aims to secure a total of $3.3 billion in the first half for production capacity expansion.SK On, wholly-owned by SK Innovation Co., is processing related works to receive the investment from a consortium led by South Korea-based EastBridge Partners, according to investment banking industry sources on Friday. Korea Investment Private Equity and Stella PE participated in the consortium.Those PE firms have reportedly been discussing the investment and carrying out due diligence since early this year, apart from SK On’s effort to secure money from global PE firms. Their investment conditions are expected to be the same as ones for the global PE firms, anchor investors – institutional investors who are allotted shares before an initial public offering opens for a subscription.The South Korean consortium is set to secure about a 3% stake in SK On through the investment. Deutsche Bank and JPMorgan are managing the deal.EastBridge’s CEO Choi Dongsuk served as head of Korea investment banking division at Goldman Sachs in Seoul from 2014 to 2017. Prior to working at the South Korean branch, he spent 12 years in M&A and sponsor group at the investment banking division at Goldman Sachs in Hong Kong.TO SELECT 2-3 GLOBAL PEFS FOR SHARE SALESK On is already slated to raise some 3 trillion won from global PE firms. The company has narrowed bidders for its shares to four candidates - BlackRock, The Carlyle Group, KKR and Singapore's sovereign wealth fund GIC. They are conducting due diligence ahead of the final bidding scheduled to be held soon.SK On is known to select two or three of them, given the large size of the investment.The battery maker is expected to accelerate capacity expansion in overseas markets once it completes the fundraising. Earlier this month, SK On and Ford Motor Co. announced a plan to set up a joint venture to produce EV batteries in Turkey with a local company.SK On and Ford are already building battery plants in the US through BlueOvalSK, a JV established last year.The South Korean company is predicted to raise more money around next year to finance these projects.By Chae-Yeon Kimwhy29@hankyung.comJongwoo Cheon edited this article.
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