SK sells near 5% in global logistics firm ESR for $408 mn

2020.09.17 14:08:18

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SK Holdings has sold part of its stake in ESR (e-Shang Redwood Group), a global logistics company listed on the Hong Kong Exchange, for 480 billion won ($408 million) to secure cash for new growth.

The parent of South Korea’s third-largest conglomerate SK Group disclosed Thursday it divested 140 million shares or 4.6 percent of ESR for HK$22.5 per share in a block deal.

The Korean oil refiner bought a total of 11 percent of the logistics property developer for about 490 billion won in 2017.

After the transaction, SK Holdings retains a 6.4 percent stake which is worth about 740 billion won as of the closing price on Wednesday.

ESR established in 2011 is equipped with digital infrastructure and fulfillment capacity and operates about 270 logistics facilities around the world. It serves more than 200 customers, including Amazon, Alibaba and JD.com.

Oil refiner SK Corp. was the second-largest shareholder with an 11 percent stake at the time.

SK invested a total of 490 billion won in ESR in 2017 and 2018 and its investment paid off on Nov. 1 last year when ESR went public in Hong Kong. ESR was trading at HK$24.75 per share on Wednesday, up 47 percent from its IPO price. SK’s stake ownership in ESR surged by about 2.5 times in about three years.

SK plans to use the proceeds from stake sales and dividend payments this year to nurture new growth engines and innovation while probably raising a return for its own shareholders.

By Minu Kim

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