Private Equity Korea

2013 Global M&A Plaza

Jennifer Wanninger — Mon, 20 May 2013 08:54:06 +0000

KOTRA’s new Global M&A Center will be holding an upcoming M&A Forum that aims to help domestic SMEs find strategies to globalize.

At the forum, we will introduce M&A opportunities through our first session which will target three regions, Europe, China and Japan. China with one the fastest growing domestic markets in the world, Japan with a rapidly changing economy due to direction from their new government and Europe with an abundance of M&A activity due to the European debt crisis all provide Korean companies with diverse opportunities.

During the second session, we will examine various case studies in order to see how Korean companies have partnered with foreign investors to expand into global markets.

After the morning sessions, we will be holding one on one meetings where Korean companies have the opportunity to meet with foreign investors as well as foreign M&A advisories.

Date : Tuesday, May 28, 2013, 09:00~18:00

Location : COEX Conference Room 3rd floor (317), Seoul, Korea

Program : M&A Forum and 1:1 Meetings

Forum agenda

• Session 1 : Regional M&A Opportunities (Europe, China, Japan)

• Session 2 : Globalization Strategies – Partnering with Financial Investors

For more information or if you are interested in registering for the conference, please contact Jennifer Wanninger at jwanninger@kotra.or.kr

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Jennifer Wanninger — Mon, 20 May 2013 08:46:47 +0000

Korean SK Planet and the listed Indonesian phone operator XL Axiata have formed a joint venture as of May 16 to provide telecommunications services, according to a stock exchange announcement. Both will go 50-50 into the venture with USD 18.3 million each.

The JV was designed to support XL Axiata’s business of providing digital services and strengthen their position in the Indonesian telecom sector.

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TK Chemical mulling buys of US or Japan-based UHMWPE fiber manufacturers, source says

mergermarket — Mon, 20 May 2013 08:40:01 +0000

TK Chemical, a listed South Korea-based chemical manufacturer and part of South Korean SM Group, is mulling buys of US or Japan-based ultra-high-molecular-weight polyethylene (UHMWPE) fiber manufacturers, a source familiar with the situation said.

Among the three types of super fiber, such as carbon fiber, aramid and UHMWPE fiber, UHMWPE is regarded as TK Chemical’s new growth engine. TK aims to enhance related manufacturing technology via deals, the source added. UHMWPE is highly resistant to corrosive chemicals, ten times tougher than steel and lighter than other super fibers, mainly used in bulletproof jackets and medical equipment. The carbon fiber and aramid markets are somewhat saturated and competitive in South Korea, the source said.

“In Japan, there are many companies with advanced aramid and UHMWPE manufacturing technology, and the weak Japanese yen also means that our company would prefer the Japanese market,” the source said.

US-based companies are particularly advanced in UHMWPE technology, and DuPont and Honeywell are among them, the source said.

The overseas buy process is likely to kick off after TK Chemical finalizes a deal with Woongjin Chemical, a listed South Korean textile and plastic product developer, this year. If it does not go through to the final stages with Woongjin Chemical, TK Chemical would drop that attempt and seek overseas assets this year or next, the source said.

The source did not provide a deal size. TK Chemical could consider debt issuance or use the cash it has in hand for smaller deals. The source also noted it could team up with Korea Trade-Investment Promotion Agency (KOTRA) or government promoted funds. For a large deal, partnering with an another strategic investor could also be an option, according to the source.

South Korean Kolon and Hyosung are among the major players in the fiber market, the source added.

TK Chemical, founded in 2007, generated sales of KRW 852 billion (USD 765 million) and an operating loss of KRW 13 billion, according to the company’s financial report. The company had cash and cash equivalents of KRW 51.8 billion (USD 46.5 million) at end 2012.

by Soo Young Park and Eun Young Chough from Mergermarket in Seoul

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ING Life Insurance Korea awaits final bids

Jennifer Wanninger — Mon, 13 May 2013 08:40:25 +0000

Final bids for ING Group’s sale of ING Life Insurance Korea are expected in early June as due diligence reaches completion. ING must divest its holdings in all its Asian insurance units by the close of 2013 under the revised terms of a 2008 Dutch government-bailout package. While it has already reached deals for its Malaysian, Hong Kong, and Thai businesses, the Korean subsidiary remains.

While ING would prefer to sell 100 percent of ING Life Insurance Korea, they will accept bids for at least 51 percent.

Hanwha Life Insurance Co. in partnership with Q Capital Partners and KTB will be submitting a final bid alongside Kyobo Life Insurance Co., MBK Partners, KB Financial Group and others.

According to sources, a 51 percent stake in the insurance arm will go for between USD 1-1.5 billion and a 100 percent stake will be between USD 2-2.5 billion.

The sale process was revived earlier this year after talks with KB Financial Group collapsed late last year.

ING Life Insurance Korea is Korea’s fifth-largest insurer by assets and the largest among ING’s Asian insurance subsidiaries.

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CJ Freshway raises over USD 63 million for overseas buys

Jennifer Wanninger — Mon, 13 May 2013 07:49:18 +0000

The listed Korean food distributor, CJ Freshway, has raised 70 billion won (USD 63.9 million) from a recent bond issue, according to a report in the Yonhap Infomax. The report went on to state that the proceeds from the bond issue will be for the purchase of overseas catering companies or food suppliers later this year.

The bonds issued are convertible into the company shares and will mature in 30 years.

No perspective targets have been disclosed.

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Jennifer Wanninger — Tue, 07 May 2013 01:58:59 +0000

The listed Korean security solution developer, NexG, has attracted Oullim, a Korean IT group, in their sale of a 36.8 percent stake, according to a report in Etnews. The article also cited Dong-hyuk Park, CEO of Oullim Group, confirm that the company would make a bid for the stake.

Nuri Telecom put their stake up for sale earlier and has mandated Woori Investment & Securities as the financial advisor of the stake sale.

NexG has a market cap of 37.4 billion won (USD 34.1 million).

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STX Group looks to sell STX Energy to Korean PE to fund raise

Jennifer Wanninger — Tue, 07 May 2013 00:35:14 +0000

STX Group, the liquidity-starved Korean conglomerate, is looking to sell its controlling stake in STX Energy to a local private equity firm in order to raise around 400 billion won (USD 363 million) according to a recent article by Dow Jones.

The group’s holding company, STX Corporation, plans to sign an MoU with Hahn & Co. that will pave the way for the PE investor to conduct due diligence on the 50.1 percent stake in the energy affiliate.

STX Group has been facing a liquidity shortage in the wake of the 2008 global financial crisis.

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Smac to set up JV with Japanese Nissha Printing

Jennifer Wanninger — Mon, 06 May 2013 05:35:17 +0000

The listed Korean mobile phone parts maker, Smac, recently announced that it will acquire a 51 percent stake in a joint venture to be set up with Nissha Printing for 11 billion won (USD 10 million).

The Japanese electronic parts maker, Nissha Printing, will hold the remaining 49 percent in the JV named NS Tech to be set up in South Korea as a manufacturer of touch sensors for mobile phones.

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Largest shareholder in JCEntertainment to sell stake to Korean PEFs

Jennifer Wanninger — Mon, 06 May 2013 05:28:19 +0000

Nexon Korea, the Korean game developer and largest shareholder in JCEntertainment will sell their stake in the listed Korean online and mobile game developer to two Korean private equity funds (PEFs) at the end of this month. The transaction will cost the PEFs 31.1 billion won (USD 28 million), according to a stock exchange announcement last April.

By 31 May, KoFC Skylake Growth Champ 2010-5 and Skylake 4-0901 will own a combined 14.73 percent stake in JCEntertainment.

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Woongjin finalizing legal advisor line up to sell chemical and food units, source says

mergermarket — Mon, 06 May 2013 05:07:40 +0000

Woongjin Holdings will hire Bae Kim & Lee and Lee & Ko as legal advisors respectively to sell both its chemical and beverage units after obtaining court approval for the deal, a source familiar with the situation said. Woongjin Holdings will also mandate Yeil Accounting and Jisung Accounting as accountants for each unit, the source added.

The court will approve the proposal of Woongjin Holdings as early as today, a source at the court said.

Woongjin Holding disclosed on 11 April that it had mandated Woori Investment & Securities and Korea Investment & Securities as financial advisors for Woongjin Chemical. Woongjin Foods is working with Samsung Securities.

Samsung Securities began due diligence to receive preliminary bids in mid-June, as earlier reported by this news service. After lining up the advisory group, the accountant will assist with the due diligence process of the two units before accepting preliminary bids ahead, the first source said.

Woongjin Holdings, which entered court receivership last year, plans to sell both a 46.3% stake in Woongjin Chemical and a 47.49% stake in Woongjin Foods this year. Multiple strategic and private equity firms are vying for the assets.

Revenues of Woongjin Chemical, which was acquired by the Woongjin Group in 2008, were KRW 1.1tn (USD 979bn) last year, with operating profit at KRW 28.4bn, according to its latest financial report.

Woongjin Chemical has a market capitalization of KRW 339bn. It recorded sales revenues of KRW 215.8bn with operating profit at KRW 4.2bn in 2012, according to its latest financial report.

by DooBo Shim in Seoul

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