SK Group's Investment Holding Company To Sell 100% of its Stake in Turo to G Squared

By: Asia Business Outlook Team | Thursday, 16 March 2023

SK Inc., South Korea's SK Group's strategic investment holding company, announced on Thursday that it has agreed to sell its entire stake in Turo, a peer-to-peer (P2P) vehicle car-sharing company, for USD 67.5 million (approximately KRW 88.1 billion). The transaction, which will see SK Inc. sell its stake in Turo to existing shareholder G Squared, is expected to close in the first half of this year.

"We are pleased to collaborate with SK Inc., strengthening our relationship and providing liquidity to a fellow long-standing Turo shareholder", said Larry Aschebrook, Founder & Managing Partner of G Squared. "With the purchase of these shares, G Squared will become the second-largest shareholder in Turo, reaffirming our commitment to this promising peer-to-peer car-sharing marketplace."

As a result, SK Inc. will earn approximately 121% (in KRW) on its initial investment of USD 35 million (approximately KRW 39.8 billion at the time) in 2017.

Turo, founded in 2009 and headquartered in San Francisco, California, operates a peer-to-peer car sharing marketplace that connects hosts and guests, allowing guests to book the ideal vehicle for any occasion. Turo now operates in over 10,000 cities across the United States, the United Kingdom, Canada, France, and Australia. The company has grown to become the largest car-sharing marketplace in the world.

Turo created a new category of transportation by allowing guests to select from a wide range of privately owned vehicles. Turo streamlined processes for vehicle pickup and return at a cost-competitive price when compared to existing business-to-customer (B2C) car-sharing models.

SK Inc. has been expanding its portfolio in the rapidly expanding mobility sector, investing approximately KRW 100 billion in Korea's SOCAR in 2015. With its investments in Grab and Turo, SK Inc. has led the global market for vehicle sharing and mobility technology.

SK Inc. intends to increase its investments in car-sharing, EV charging platforms, and self-driving solutions in Korea and Southeast Asia as a result of its global success. The company intends to promote SOCAR Malaysia, of which SK Inc. is the largest shareholder, as Southeast Asia's representative mobility platform in particular.

In 2017, SK Inc. entered the Southeast Asian mobility market through a joint venture with Korea's SOCAR in Malaysia. In 2020, SK Inc. secured management rights by purchasing an additional stake in SOCAR Malaysia. With 1.9 million members, SOCAR Malaysia is currently Malaysia's No. 1 car-sharing platform, commanding more than 90% of the market. The number of users has risen to 20,000 per day in recent months, up from an average of 5,000 per day during the COVID-19 pandemic period.

By combining SOCAR Korea's existing B2C car-sharing business model with TREVO's P2P car sharing model and Buddy Driver of Korea's personal driver service, SK Inc. was able to develop SOCAR Malaysia into an integrated mobility platform.

SOCAR Malaysia will enter the Indonesian market in 2020 with a unique business model. EastBridge Partners, a global private equity firm based in Korea, and Sime Darby Berhad, a Malaysian multinational corporation, will invest a total of KRW 65 billion in 2021. The Indonesian market, with a population of nearly 300 million people, is known for its growth potential.

"Over the past few years, SK Inc. has integrated the business know-hows acquired from the advanced mobility markets in the U.S. and South Korea to SOCAR Malaysia, a subsidiary of SK Inc., and built it into the No. 1 company in Malaysia within two years of launching the service," said Kyungsang Yu, the Head of Digital Investment Center at SK Inc. "By focusing on the Southeast Asian mobility market, which is expected to grow rapidly in the coming years, SK Inc. will build a leading car-sharing company in Southeast Asia while reinforcing the virtuous cycle of reinvesting our funds into new mobility businesses."