SEOUL: SK Group will combine two units as billionaire Chey Tae Won cements control of South Korea’s third-largest private conglomerate from a prison cell, where he’s serving a sentence for embezzlement.
SK C&C Ltd., a provider of information-technology services, will acquire SK Holdings Co. in an all-stock deal, according to a filing Monday. The combined company, spanning businesses from energy to semiconductors, will have total assets of about 13.2 trillion won (S$16.41 billion), they said in an e-mailed statement.
Chey will become the largest shareholder of the combined company as South Korea pushes for family-run conglomerates, known as chaebol, to revamp complicated ownership structures and boost transparency at the businesses that dominate the nation’s corporate landscape. Samsung Group combined units and simplified businesses after President Park Geun Hye’s government banned the creation of new cross-shareholdings and offered tax breaks for restructuring.
“The move will help SK Group to straighten its governance structure by boosting major shareholder Chey Tae Won’s influence,” said Nam Dong Woo, head of equities at Eastspring Asset Management Korea Co. in Seoul, a South Korean arm of Prudential Plc. “This will promote other industrial groups to speed up their governance structure overhaul and head to holdings company structures, too.”
