South Korea’s leading oil refiner SK Innovation Co. said Sunday it is on course to list its wholly-owned subsidiary SK Lubricants Co. in May for the biggest Korean initial public offering estimated at 1.25 trillion won ($1.2 billion).
SK Lubricants plans to offer a total of 12,765,957 shares - 2,553,191 in new shares and 10,212,766 in existing shares held by SK Innovation. SK Innovation eyes 1.25 trillion won from selling its equity share in the lubricant unit if the pricing is determined at the upper end of the offered band.
The outstanding shares of 42,553,191 would put the company valuation between 4.3 trillion won and 5.2 trillion won, and keep SK Innovation as the majority stakeholder with a 70 percent ownership.
With new ammunition, SK Innovation plans to accelerate M&As in search of new revenue sources.
Last year, the refiner acquired Dow Chemical’s ethylene acrylic acid (EAA) and polyvinylidene chloride (PVDC) business units and agreed last month to invest 840.2 billion won to build an electric vehicle battery plant in Komarom, Hungary. Most recently, the company, through its subsidiary SK E&P America, decided to buy the entire stake in U.S. shale oil and gas company Longfellow Nemaha LLC.
SK Lubriants will use its share of the IPO to cement dominance in the high-quality Group III lubricant category. It currently holds a 39.3 percent share in the global market.
Shares of SK Innovation closed Monday up 0.75 percent at 202,500 won.
By Kang Doo-soon and Kim Hyo-jin
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