SK Group's AI Infrastructure Divestment Draws Domestic and Overseas PE Interest
Infrastructure deals have become a cornerstone of private equity fund (PEF) activity this year. While past deals centered on waste and environmental projects, recent transactions now focus on energy and data centers. Notably, SK Group's asset reallocation strategy, which involves divesting energy generation and infrastructure assets, is creating opportunities for private equity operators (PE).
Domestic and Overseas PE Focus on K-Infrastructure Market
SK Horizon, an artificial intelligence infrastructure specialist established by separating SK Broadband's data center and submarine cable businesses, has attracted significant interest from domestic and overseas PE firms. SK Telecom disclosed this structural change through a regulatory filing on August 27, 2026. A consortium of IMM Investment and Stonebridge Capital, along with global private equity firm Kohlberg Kravis Roberts (KKR), each acquired 20 percent and 29 percent stakes in SK Horizon respectively. SK Horizon raised approximately 3.08 trillion won in investment by selling both existing and new shares to these investors.
KKR, which established Eclipse, a renewable energy joint venture with SK, acquired a 43.10 percent controlling stake in SK Eternics held by SK Discovery and Han and Company, according to a filing in the same month. The joint venture, aimed at creating an integrated renewable energy platform, also took over renewable energy business divisions from SK E&S and SK ecoplant. A consortium of Stick Alternative Asset Management and Korea Investment Private Equity acquired a 49 percent stake in SK Multi-Utility and Ulsan GPS for 1.6 trillion won in June.
Lee Kyung-ja, senior research fellow at Samsung Securities, said: "Domestic conglomerates are divesting capital-intensive energy generation and infrastructure assets to concentrate funds on growth businesses such as semiconductors, batteries and AI. PE firms are seizing this as an opportunity to expand their infrastructure asset portfolios amid conglomerates' capital reallocation pressures."
This trend mirrors the global market. Global PE firm Blackstone expanded its investment in Invenergy, a U.S. renewable energy developer, in 2023. After investing approximately 3 billion dollars in the company from 2021 to 2022, Blackstone made an additional 1 billion dollar investment, bringing total investment to 4 billion dollars. It also acquired data center REIT QTS in 2021 and continues operations. According to Samjong KPMG data, energy and natural resources sector investments accounted for 822 deals worth 149.2 billion dollars in the first half of this year, representing 14.5 percent of all sectors.
Demand and Policy Support Drive Institutional Infrastructure Investment Expansion
AI sits at the center of PE firms' focus on domestic infrastructure. As the AI era unfolds, the data center market is experiencing rapid growth, and power demand forecasts linked to this expansion are also rising. Recently, the Demand Planning Subcommittee of the Coordinating Committee for the Basic Plan on Long-term Electricity Supply and Demand presented 2040 peak power demand forecasts of 158.4 gigawatts (baseline) to 165.0 gigawatts (upward revision), reflecting three mega projects: semiconductors, AI data centers and physical AI. This figure is 26.6 to 26.8 gigawatts higher than the forecast presented in April.
Policy provides support as well. After announcing a "private investment activation plan" in 2024, the government expanded its support scale and direction this year. The five-year target for private investment projects expanded from the previous 30 trillion won to 100 trillion won. Infrastructure project targets also shifted from delayed construction start projects to focus on discovering new projects such as AI data centers and power grids.
Policy funds are also flowing toward infrastructure. A prime example is the National Growth Fund. The National Growth Fund, which allocates 30 trillion won annually over five years starting this year, has already confirmed support for the Sinan Ui offshore wind power project in South Jeolla Province, Samsung Electronics' Pyeongtaek P5 facility, Smilegate's data center and Naver's data center expansion.
Limited partners (LPs), which play an important role in PE funding, are also adjusting their investment strategies to increase infrastructure concentration. For example, the National Pension Service and the Military Mutual Aid Association are strengthening and establishing dedicated teams for this purpose. Lee said: "As exit delays in alternative investments continue to create a distribution drought, LPs have begun prioritizing distributions as much as final internal rate of return (IRR). In particular, a clear shift in funds from real estate, which shows weak distributions, and reduced PE strategy allocations toward private lending and infrastructure is being observed."
However, PE infrastructure investment carries risks. PE investment periods typically span five to ten years, while infrastructure asset lifecycles are longer, requiring careful exit strategy planning. Additionally, infrastructure assets themselves do not typically generate high returns, a factor that must be carefully considered during investment.
Lee Bo-ram, partner at EY-Parthenon, who has advised on multiple PE infrastructure deals, said: "Because infrastructure involves large-scale assets, expected exit timing must be set and exit targets should be identified and secured not only among domestic PE but also global PE as potential investors. Generally, compared to other industries, growth potential and returns are not particularly high, so it is important to fully utilize leverage effects by thoroughly examining whether stable cash flows are generated and establishing a sound financing structure."
KWI developer profile — Hanwha Ocean
5 projects in Korea totalling 1,982 MW. Compiled from the KWI database. Not part of the source article.
Sinan Ui Offshore Wind — this article
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ChilHae 1 Offshore Wind
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ChilHae 2 Offshore Wind
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Boryeong Nokdo Offshore Wind
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Gogunsan Offshore Wind
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Project data: KWI database — Electricity Business Licence records, EIA filings (ME2021C012, ME2026C003, ME2026C014), Electricity Regulatory Commission minutes, and pre-EBL permit filings.
Original Korean article: view.asiae.co.kr
English brief by Korea Wind Intelligence, koreawindintel.com
