S Connect fully impaired its investment in carbon resource recycling subsidiary Eco High Tech, writing down the entire 4 billion won acquisition cost to zero. The subsidiary developed a PCCU unit to convert greenhouse gases into synthesis gas but failed to commercialize, recording zero sales for three straight years and cumulative net losses of about 2.4 billion won. Venture capital investors Stonebridge Ventures and IBK Bank recovered their 7 billion won investment at a near-flat 2% annualized return, effectively a loss after fees. The write-off follows a broader pattern of carbon project delays in South Korea. Eco High Tech was spun off from S Connect in 2021 and initially attracted VC interest amid global climate crisis concerns. But the PCCU technology never reached commercial scale, and the subsidiary's assets shrank from 8.2 billion won to around 1 billion won in a year. The parent company also faces governance risks from a fatal battery factory fire at affiliate Aricell and legal troubles for its largest shareholder. For carbon market watchers, this case highlights the gap between early-stage carbon capture hype and real-world commercialization. The technology worked at the R&D level but couldn't generate sales or attract follow-on investment. The near-zero return for VCs suggests that even well-funded carbon projects face steep execution risk in Korea's current market environment.
