SK Inc., the holding company of South Korea’s second-largest conglomerate SK Group, is in discussions to sell its entire 13.3% stake in China’s top fresh produce company, Joyvio Group. This move comes five years after its initial investment and is part of SK Group’s broader effort to streamline its portfolio by offloading non-core assets.
Sources within the investment banking industry confirmed on Sunday that SK is considering exercising its put option contract with Joyvio. This contract, signed during the initial stake purchase, grants SK the right to sell its shares at a predetermined price before the contract’s expiration.
An SK official, who wished to remain anonymous, stated, “We are seeking to sell our stake in Joyvio, but nothing has been confirmed yet.”
Joyvio, established in 2012 by Chinese conglomerate Legend Holdings Corp., specializes in distributing fresh produce, seafood, and alcoholic beverages. It also provides catering services in China and owns several international food companies, including Australian seafood firm KB Seafood Co.
SK acquired its stake in Joyvio for ₩213.7 billion ($157.7 million) in 2019, coupled with a put option. In 2021, SK and Joyvio launched a ₩100 billion fund to invest in alternative protein startups in China, with SK contributing ₩18 billion to the fund.
The potential sale of Joyvio is seen as a strategic move by SK to rebalance its portfolio and concentrate on more profitable ventures. In 2023, Joyvio reported a net loss of ₩33.9 billion on sales of ₩3.9 trillion, with SK’s stake valued at ₩196 billion, lower than its initial purchase price.
Under the leadership of Chey Chang-won, chairman of the SK SUPEX Council, SK Group’s top advisory body, SK has been actively divesting non-core assets. Recently, SK Networks Co. negotiated with Affinity Equity Partners to sell its 100% stake in SK Rent-a-Car Co. for ₩850 billion. Additionally, SK Square Co. sold its 2.2% stake in gaming giant Krafton Inc. for ₩270 billion in April.
These divestitures are part of a broader strategy to focus on high-growth areas. Since becoming an investment holding company in 2017, SK has invested heavily in alternative food companies globally, including a ₩120 billion investment in US-based Perfect Day and ₩10 billion in cell-cultivated salmon producer Wildtype.
Despite the ongoing restructuring, SK shares saw a slight increase of 0.1% to ₩157,000 on Monday morning, although the stock has been declining since earlier this year.
