SK On, a battery technology company and a subsidiary of SK Innovation, has secured a significant long-term financial investment of up to $944 million to support the continuous growth of its battery business in the global market.

The agreement involves SK Innovation, SK On, and the MBK Consortium, which comprises financial investors from the United States, the Middle East, and other regions.

MBK Consortium will invest $800 million in SK On. Additionally, SNB Capital, a subsidiary of Saudi Arabia’s largest commercial bank, Saudi National Bank, is in discussions to invest up to $144 million in SK On through the Korea Investment PE EastBridge Consortium.

SK On operates EV battery production facilities in South Korea, the United States, China, and Hungary. The company plans to significantly increase its annual production capacity from 88 GWh in 2022 to at least 220 GWh by 2025.

To achieve this ambitious goal, SK On is expanding its existing facilities and pursuing joint ventures with major car manufacturers like Ford and Hyundai Motor Group to establish new battery production projects.

Prior to this recent funding, SK On had already raised $2.4 billion through the Korea Investment PE EastBridge Consortium and additional investments from its parent company, SK Innovation.

With the newly secured investments, SK On has exceeded its initial target of $3 billion, reaching a total funding amount of up to $3.4 billion.

In a separate announcement, SK Innovation revealed its commitment to providing a debt guarantee for SK On’s borrowing of $1.5 billion from Hyundai Motor Company and Kia.

This move aims to enhance financial stability by diversifying funding sources for SK On while fostering closer relationships with customers through reliable battery cell supply and strategic partnerships.

In April this year, Hyundai Motor Group said it would form a 50:50 joint venture with SK On to invest $5 billion in an electric vehicle battery cell production facility in the United States. The manufacturing facility is expected to produce 35 GWh of EV battery cells annually by 2025, sufficient to support the production of 300,000 all-electric vehicles.

Electric vehicle sales in India reached 349,676 units in the first quarter of 2023, a year-over-year increase of 81% compared to 192,565 units sold in the same period last year.