This case examines the M&A and financing process of SK Ecoplant's transformation from a general construction company into an eco-friendly energy company. Over the past three years, SK Ecoplant has raised large amount of funding by issuing bonds and borrowing from financial institutions to finance the acquisition of a number of environmental and energy companies. In this M&A process, SK Ecoplant's borrowings have rapidly increased, resulting in a deteriorating financial structure and the increased burden of financial cost. In this situation, SK Ecoplant issued two types of hybrid securities, KRW 400 billion of redeemable convertible preferred stocks (RCPS) and KRW 600 billion of convertible preferred stocks (CPS), to improve its financial structure, increasing its capital by KRW 1 trillion. According to international financial reporting standards (IFRS), the RCPS can be classified as capital since the right to claim reimbursement is with the issuer in this case. The CPS is also classified as capital because the conversion rate to common stock is fixed. However, a closer examination of its issuance contract reveals that the economic substance of the RCPS and CPS is more close to liability. Recently, hybrid securities that have both equity and debt characteristics are widely used in the capital market. It is expected that this case is helpful for external information users such as investors to thoroughly understand the issuance structure and economic substance of hybrid securities, and further properly judge the financial soundness of the company.