South Korea's largest electronic specialty gas company is for sale!

SK Group plans to sell SK Specialty, South Korea's lArgest electronic specialty gas company, for an estimated price of several trillion won.

SK Specialty is the largest electronic specialty gas company in South Korea. It ranks first in the world in nitrogen trifluoride market share (40%), ranks first in the world in silane production capacity for the production of silicon negative electrode materials for electric vehicles in a cooperation project with REC Silicon, and ranks first in the world in tungsten hexafluoride (WF6) used in the metal wiring process of integrated circuit manufacturing with an annual output of 2,000 tons.

Its customers include large semiconductor and display companies such as SK hynix, Samsung Electronics and LG Display. As semiconductor manufacturers have shifted their focus to 12-inch wafers, which require about twice as much gas as 8-inch wafers, demand has increased. Specialty gases used in negative electrode materials for electric vehicle batteries are also growing year by year, and this material has been seen as an ideal product for future investment.

According to Korean media reports, SK holdings, which owns 100% of SK Specialty, is negotiating with large private equity management companies such as MBK Partners and Han & Company to sell SK Specialty. First, the willingness and expected price of these private equity funds to acquire the company will be evaluated, and if the conditions are ripe, full negotiations will begin.

International organizations believe that once SK Specialty enters the market, competition among candidates will be fierce. Due to the booming development of artificial intelligence (AI), the demand for electronic specialty gases is recovering. The specialty gas industry is considered an industry with a high entry barrier due to the difficulty in obtaining certification.

SK Group plans to sell SK Speciality because SK Speciality's parent company and group holding company SK holdings urgently needs to improve its finances. Due to years of mergers and acquisitions (M&A), the company's net borrowings exceeded 10 trillion won in the first half of 2024. SK Group believes that selling SK Specialty and injecting trillions of won in cash at one time will quickly turn the situation around and improve the balance sheet.

It is reported that the negotiations are still in the early stages and the sale price is expected to reach trillions of won. However, due to the huge scale of the transaction, negotiators also mentioned the option of selling part of the shares and jointly managing the company instead of selling it directly.