SK ie technology to be absorbed by SK Innovation in 0.12 merger

SK ie technology said it will be absorbed by SK Innovation, its parent, in a merger that the companies expect to yield 61 billion won ($46.1 million) in annual cost savings.

The merger ratio is 0.1174540 SK Innovation shares for each SK ie technology share, reflecting per-share valuations of 125,862 won ($95) for SK Innovation and 14,783 won ($11) for the separator maker. Dissenting shareholders may demand the company buy back their stock at 14,620 won ($11) a share, with that period running to Dec. 14 and the company expecting to pay out those claims by Dec. 30. Opposition to the merger must be filed between Sept. 9 and Sept. 23.

SK Innovation has said the merger is meant to address worsening profitability in SK ie technology's separator business, which it attributed to slowing electric vehicle market growth, delayed demand recovery in major markets including North America, and intensifying price competition as Chinese rivals expand capacity. Those pressures have made it harder for the separator unit to raise funds and generate cash on its own, the company said.

SK ie technology reported second-quarter revenue of 39.5 billion won ($29.8 million) and an operating loss of 63.4 billion won ($47.9 million).

The merger follows SK Innovation's agreement to sell a 70.6 percent stake in SK Siltron for 2.3 trillion won ($1.74 billion) and a stake in SK Oceanplant for 410 billion won ($310 million).