Global investment firm KKR has committed over $3 billion in South Korea's artificial intelligence supply chain, focusing on data centers and renewable energy assets. This substantial investment comes as South Korea experiences a significant surge in AI chip demand, driving strong export growth.
KKR's strategy involves a dual approach, combining acquisitions in digital infrastructure with dedicated power generation. For instance, KKR acquired a 29% stake in SK Horizon, an AI data center entity spun off from SK Broadband, as part of a $3.08 trillion won consortium deal. SK Horizon's operational portfolio is set to expand to 318 megawatts across eight existing data centers and new high-density AI facilities in western Seoul and Ulsan. Additionally, KKR secured a 51% majority stake in a $2 trillion won joint renewable energy venture with SK Group, recognizing that power availability is a critical bottleneck for AI data center expansion.
This integrated investment strategy aims to ensure uninterrupted and sustainable electricity supplies for high-density processing facilities. KKR also acquired a 43.10% controlling stake in SK Eternix, a renewable energy power generation company, from SK Discovery and Han & Company for approximately $350 billion won. This move highlights a broader trend where private equity firms are seizing opportunities to expand infrastructure asset portfolios as domestic conglomerates, like SK Group, divest capital-intensive assets to focus on growth sectors such as semiconductors, batteries, and AI.
The demand for AI infrastructure in South Korea is soaring, with market analysis by Samil PwC projecting financial investors to command 90% of new data center investments between 2024 and 2027. The government's "Three Major Mega Projects," focusing on semiconductors, physical AI, and AI data centers, are expected to expand data center capacity to 18 GW by 2030, nine times the current level. Samsung SDS also announced a $1.22 trillion won investment plan with KKR, targeting AI transformation technology and robotics, further underscoring the significant capital flow into South Korea's AI ecosystem.
