SK, the country’s third-largest conglomerate, made its debut in the 1950s as a textile firm, but has now evolved into a corporation that covers energy as well as information technology.
The corporation was called Sunkyung Textile back in 1953. Founded by former chief executive Chey Jong-kun, it was the first in Korea to export rayon textiles to Hong Kong in 1962.
Since stepping into the petrochemical sector about a decade later, the corporation was taken over by the founder’s younger brother Chey Jong-hyun, who led bold mergers and acquisitions beginning in 1975.
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(Illustration by Park Gee-young) |
With the younger Chey taking full charge of Sunkyung, it began more aggressively expanding its business portfolio from textile and petrochemical to construction, timber, metal, mechanics and tourism.
It was recorded as the first in the country to develop polyester film, enabling the company to go after the videotape market, which blossomed before the arrival of digital media.
However, it was the takeover of the Korea Oil Corporation in November 1980 that made it possible for the firm to leap close to its position today.
Sunkyung was speedy in transforming itself into a representative oil and energy company soon after the acquisition.
The corporation was also daring enough to get its hands on the telecommunications business, purchasing shares of what is currently SK Telecom in 1994. SKT is now the top mobile carrier with the highest number of subscribers in Korea.
Then Chey Tae-won, the eldest son of Chey Jong-hyun, took the helm of what is known today as SK Group, following the death of his father in 1998.
Major accomplishments of the third leader point to the acquisition of Hanaro Telecom ― now SK Broadband ― and most recently, Hynix Semiconductor.
Renaming the chipmaker as SK Hynix, the younger Chey added meaning to the merger and acquisition by stating that the move indicated that the conglomerate was further reaching out for globalization.
“The difference in competitiveness between SK Group and our rivals is narrowing in Korea, while we’re meeting new competition as well as challenges overseas with the trend of technology convergence,” said Chey. “We need fresh tactics that include a new growth strategy focused on technology in order to get over the barriers that exist here and abroad.”
Chey’s comments indicated that SK will strive to expand its scope of business, transforming into an export-driven organization that breaks out of its shell.
The top two companies taking forward this initiative are its flagship energy firm SK Innovation and newest member SK Hynix.
The group’s transformation into a holdings company in July 2007 has also offered ground for the conglomerate to turn itself into a global top-tier corporation after revolutionizing its structures of ownership, businesses and finance.
As testament to such success, SK Group posted a record-breaking 121.8 trillion won ($115 billion) in total sales in 2011. The figure is up about 79 percent from the 68.1 trillion won it recorded in 2006, a year before the launch of a holdings group.
SK Holdings also made No. 65 in last year’s Fortune Global 500, an improvement from No. 82 in 2011. Although the corporation slipped in 2010, it has been consistently improving every year since reaching the top 100 in 2007.
SK Group now aims to reach 300 trillion won in corporation value as this year marks the group’s 60th anniversary.
This is also the year that Chey stepped down from the helm of the SK businesses, having former SK Chemical vice chairman Kim Chang-keun take the chairman seat.
Chey said he will shift his focus to play a supporting role by mapping out new global growth engines along with his search for fresh business projects.
He said he would also concentrate on discovering and diversifying new investment resources so that financial funding can be injected in a time of need.
As part of his supporting activity, Chey will attend the Davos Forum, or the World Economic Forum, scheduled for Jan. 23-26 in Switzerland along with the heads of SK Innovation, Koo Jay-young, and SK Engineering and Construction, Casey Choi.
While discussing the role of social enterprises in one of the sessions as countermeasures to economic difficulty, job losses and polarization, he will also take part in the Korea Night event that was founded on his suggestion in 2009.
“Davos Forum marks the first international event attended by chairman Chey since stepping down from his post and also an official move that signals his drive for global management,” said an SK Group official.
By Cho Ji-hyun (
sharon@heraldcorp.com)
