SK's annual strategy meeting convenes amid cash crunch, chairman's divorce

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SK's annual strategy meeting convenes amid cash crunch, chairman's divorce

Published: 27 Jun. 2024, 17:40 Updated: 28 Jun. 2024, 18:44

JIN EUN-SOO
jin.eunsoo@joongang.co.kr

SK Chairman Chey Tae-won, left, with OpenAI CEO Sam Altman [SCREEN CAPTURE]

SK Group embarks on a two-day strategy meeting from Friday, with more than 30 affiliate executives convening to discuss rebalancing the conglomerate's business portfolio as it is in desperate need of a significant cash flow to salvage its bleeding EV battery unit amid the ongoing divorce case of Chairman Chey Tae-won that could cost him more than 1.3 trillion won ($938 million).

The annual meeting will also review how to achieve qualitative growth on the back of investments in potential business ventures such as AI.

"In the face of an AI era, it is expected that the largest-ever investment is required in AI ecosystem-related businesses, such as high bandwidth memory chips, for the next two to three years," SK Group said in a release.

"SK CEOs will also thoroughly discuss how to secure financial resources through portfolio restructuring and operational improvements that have been conducted by each company from early this year."

SK Group's rebalancing effort is expected to include mergers as well as divestment from unprofitable or redundant businesses.

The merger of SK Innovation, the owner of EV battery company SK On that has hemorrhaged more than 2 trillion won since its founding in 2021, and the profitable SK E&S could be one of the options, according to local media reports. Stake sales of SK IE Technology has also been floated as an option.

"The CEOs will discuss ways to achieve qualitative growth in potential businesses in the future such as battery and bio through substantial 'operational improvement' management," the company said in a release.

SK Chairman Chey will participate in the meeting through video call as he is currently on a business trip to the U.S.

On Thursday, he uploaded photos of himself on his Instagram account with OpenAI CEO Sam Altman and Microsoft CEO Satya Nadella in their respective headquarters in San Francisco and Redmon, Washington.

Chey is currently in the midst of the country's most expensive divorce case with his estranged wife, Roh Soh-yeong, which could cost him more than 1.3 trillion won.

The group chairman had said he will continue with his business activities regardless of the legal dispute.

"Life goes on," Chey wrote on the Instagram post, adding that he is holding meetings everyday with "IT insiders" in San Francisco and Seattle.