Korea's SK Innovation liquidates Chinese battery subsidiary

The Chaebol that also runs chipmaker SK hynix lacks energy to run multiple middle kingdom entities

SK Innovation, part of the same Chaebol as chipmaker SK hynix, has liquidated its Chinese battery subsidiary, Blue Dragon Energy.

The move was detailed in an audit report filed with the South Korea Financial Supervisory Service on March 12 revealing that the entity was liquidated last year.

Local media cited the reason for the liquidation as SK Group's desire to streamline operations, as its different business units had overlapping goals.

"Blue Dragon Energy was an investment entity for the battery business in Greater China. After the split-off of SK On from SK Innovation in 2021, Blue Dragon Energy no longer has a reason to run under SK Innovation, as SK On is active in China," explained an SK Innovation spokesperson, according to reports.

SK On is SK Group's battery business. It recently brought in former SK hynix CEO Lee Seok-hee to lead the division in an effort to stabilize SK Innovation at a time when it has been losing money. Lee has offered to forgo up to 20 percent of his income until he turns the business profitable, to show how dedicated he is at a time when the EV battery market is tight in South Korea.

Before Blue Dragon was nixed, it had planned to establish a battery cell factory, promote partnerships that would secure raw battery materials, and strike joint ventures.

SK Innovation had invested ₩86.4 billion ($65.6 million) in 2018 to get Blue Dragon Energy going, and itself into the Chinese battery market.

Since then, SK Innovation has entered into other battery endeavors in China – including a battery swap business when it became a strategic investor in Blue Park Smart Energy (BPSE). It has also invested in building various battery factories across the Middle Kingdom. ®

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