Samsung Electronics and SK Hynix rejected a 25 trillion won ($18.7 billion) prepayment proposal from Korea Electric Power Corp. (KEPCO). The state-run utility requested the funds to cover five years of electricity costs in advance.
KEPCO intended to use the capital to finance essential power grids for new semiconductor mega clusters. The chipmakers cited the massive upfront cash outlay as a significant financial burden amid an uncertain long-term outlook.
Management expressed concerns that the current semiconductor supercycle might not persist for another five years. The rejection threatens to delay KEPCO’s planned grid investment and expansion projects.