Chinese boutique investment bank Reorient Group has entered into an agreement to acquire a 33 percent stake in EQ Partners, a Seoul-based private equity firm with assets in Korea and other Asian countries, according to a company statement.
Reorient is backed by mainland conglomerate China Chengtong Holdings.
Reorient will pay around HK$32.7 million (€3.2 million; $4.2 million) for the firm, which currently has $800 million in assets under management, according to the statement.
The deal reportedly marks the first time a mainland Chinese bank has acquired a Korean private equity firm, which suggests an increased interest in Korea's private equity market.
The statement outlined the reasons for the deal, saying, “The acquisition is part of the group’s strategy to expand its network of potential clients, investors and investees. Korea is a key market for the group on account of its financial and strategic buyers, who are among the most active in Asia.”
Activity in Korea’s private equity industry has recently picked up. During 2012, Korea stood out as the only Asian market with increased deal activity year-on-year. The country received $3.7 billion of private equity investment, a 95 percent increase on the $1.9 billion invested during 2011, according to data from Mergermarket.
EQ Partners is a Seoul-based private equity firm led by chief executive officer James Kim. Kim was formerly at Korea Investment Partners and Macquarie Capital. The firm invests in buyout and growth equity deals within and outside Korea and manages around $800 million in assets.