November 21, 2024

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SK Square CEO nominee Han Myung-jin (SK Square)

SK Square, the investment arm of SK Group, is set to reshape its business portfolio to concentrate on the chip industry and divest "non-core" investments, under a new leader.

On Wednesday, the company nominated Han Myung-jin, the head of the company's investment support center and former chief strategy officer of SK Telecom, as its new chief executive officer, to take over from Park Sung-ha who was dismissed a week ago.

"The appointments committee in the board of directors nominated Han as the new CEO of the company. Han will be officially appointed as an inside director and the CEO after the extraordinary meeting of shareholders slated on August 14," SK Square said in a statement.

"With the young new leadership, the company will focus on improving profitability in IT and communication investments, while transforming its investment portfolio into a chip-centric one, to enhance shareholder value," SK Square said.

The nomination comes at a time when SK Group, the country's second-largest conglomerate in terms of assets, is conducting an overhaul of its affiliates to enhance business efficiency.

Under this backdrop, Han will be tasked to develop SK Square in to a chipcentric investment firm and carry out structural adjustments for the existing investment stakes in companies encompassing media contents to mobility.

SK Square is reportedly generating profit by investing in chipmaking equipment, materials and parts companies in the US and Japan via TGC Square, an investment entity SK jointly created with Shinhan Financial Group and LIG Nex1.

The investment firm was established in 2021 through a spin-off from SK Telecom and has been investing in more than 20 companies, with its key subsidiary including the prominent memory chip maker SK hynix, streaming service Wavve, online retailer 11th Street, mobile app store and operator One Store and Tmap Mobility.

In 2023, 18 out of its 23 equity-holding companies reported operational losses. So in the first quarter of this year, SK Square was only able to turn to profit after six consecutive quarters of losses, earning from the recovery of the global chip market.

In part of the effort to divest stakes, Tmap Mobility, an affiliate of SK Square, is reportedly working to liquidate its shares in Uber Taxi, which is its joint venture with US ride-hailing service company Uber Technology.

"Tmap Mobility has decided to focus on data-related business that has a higher potential for growth and value, and rid of the Taxi business which often becomes the target of criticism," an industry official said under the condition of anonymity.

Wavve is expected to continue to push for a merger with Tving, a subscription-based streaming platform launched by CJ Group. SK Square is also expected to speed up the sales of its ecommerce platform 11th Street.

By Jo He-rim (herim@heraldcorp.com)