SK square poses as a major disappointment amid back-to-back IPO setbacks

2022.05.13 14:10:31 | 2022.05.13 14:22:01

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South Korea’s SK square Co. has been a major disappointment since its launch in November last year as a standalone investment separated from SK telecom with a series of flops in IPOs to finance its M&A drive for new growth.

SK square initially vowed to triple SK square’s net asset value to 75 trillion won ($58.2 trillion) by 2025 through IPO and business partnerships.

IPO plans of SK shieldus and One Store has been scrapped one after another, causing the parent to lose confidence from investors.

SK shieldus canceled its IPO plan last week and One Store pulled its IPO out on Thursday, both due to tepid institutional demand. One Store’s IPO cancellation came only a couple of days after the CEO asserted that it will move forward with its listing despite the cancellation of its affiliate.

Other ICT companies which are planning to go public later in the year are also being impacted by the recent IPO withdrawals.

According to an IPO industry insider, the desired IPO price band for SK square was based on last year’s robust IPO market and failed to reflect the current lackluster market conditions.

SK square also did not enter any significantly lucrative deals with other companies, which has widely been regarded as SK Group’s key strength.

SK square Vice Chairman Park Jung-ho and SK Telecom CEO Yoo Young-sang, along with other executives, met with Deutsche Telekom CEO Timotheus Hottges and board member Claudia Nematagreed in Germany on May 5 and agreed to collaborate on various ICT businesses but only signed a letter of intent (LOI) for certain projects.

Shares of SK square were trading up 2.67 percent at 44,250 won as of 11:49 a.m. on Friday.

By Lee Jae-chul and Susan Lee

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