SK Ecoplant, the green business unit of SK Group [210980:KS], signed an agreement with the Malaysian government’s sovereign wealth fund Khazanah Nasional Berhad to purchase a 30% stake in Cenviro Sdn Bhd, Malaysia’s first integrated waste management company, as reported by Korean Economic Daily on May 20. The value of the deal has yet to be disclosed, but SK Ecoplant would reportedly inject KRW100bn (USD80m) into the target company for 30% of its new shares. The two companies plan to use Malaysia as a hub for the Southeast Asian environmental market and expand the business to Singapore and Indonesia. According to SK Ecoplant, it has long-term targets to enter developed markets such as North America and Europe.
Before the South Korean green business branched out into Malaysia, it had purchased a 100% equity in Singapore-based electronic waste (e-waste) disposal and recycling firm TES Envirocorp (TES) with USD1bn this February. Domestically, SK Ecoplant took over six environmental enterprises in 2021 to become a local leader in the water treatment and waste incineration sectors and the third-largest waste landfill company nationwide. The company’s rapid business expansion is driven by tightened environmental rules and mounting industrial and household wastes in South Korea. The country mandates waste sorting and requires electronics manufacturers to collect and recycle used home appliances from customers when they buy new ones, creating a prosperous waste management market. Last September, the South Korean government pledged to reduce plastic use by 60% before 2030 and build a plastic-free society by 2050.