SK Telecom Spins Off AI Data Center Unit, Secures $2.3B from KKR and IMM — KKR & Co. Inc.

Event summary

SK Telecom (NYSE: SKM) is splitting its subsidiary SK Broadband into two entities: SK Broadband (84% stake) and SK Horizon (16% stake), focusing on AI data center infrastructure.
SK Horizon secured KRW 3.08 trillion ($2.3 billion) in equity investment from KKR and the IMM Investment-Stonebridge consortium.
SK Horizon will expand Korea’s AI data center capacity to 318 MW, including eight operational data centers and new facilities under construction.
Post-investment, KKR and IMM will hold 29% and 20% stakes in SK Horizon, respectively, while SK Telecom retains a 51% majority.
The spin-off is expected to complete in Q1 2027, pending shareholder and regulatory approvals.

The big picture

SK Telecom’s spin-off of SK Horizon underscores the growing strategic importance of AI data center infrastructure in Korea’s digital economy. The $2.3 billion investment from KKR and IMM highlights the sector’s attractiveness, as global investors bet on the expansion of AI-driven data centers. This move aligns with broader industry trends where telecom operators are pivoting to high-growth digital infrastructure plays, particularly in AI and cloud computing.

What we're watching

Execution Risk: Whether SK Horizon can deliver on its ambitious 318 MW expansion plan while integrating new investments and operational changes.
Strategic Focus: How SK Telecom balances its core telecommunications business with its new AI infrastructure ambitions through SK Horizon and SK Hyper.
Market Dynamics: The pace at which Korea’s AI data center market grows and whether SK Horizon can maintain a competitive edge against global players.