Korea funds raise a record $5 billion

Fewer Korea-based fund managers are raising larger amounts.

Last year, Korea-focused funds raised $5.87 billion, the largest annual amount ever raised by Korea-based fund managers, according to Private Equity International’s Research & Analytics division.

The total was nearly six times the $1 billion raised in 2012.

The centerpiece was MBK Partners' third vehicle, which closed oversubscribed on $2.7 billion and set a record as the biggest fund ever raised by a Korea-based manager. Another effort worth highlighting was a debut $500 million fundraise from startup Anchor Equity Partners.

Both funds closed in less than a year.

The $5.87 billion raised last year was across only 10 funds, the data showed. Korea, like the rest of Asia, appears to be undergoing a flight to quality. In a trend from 2009 to 2013, fewer funds are raising larger amounts.

Last year, 13 funds raised $1 billion. In 2009, 44 funds raised $4.8 billion.

Currently 14 Korea-focused funds are in market (11 of them from Korea-based fund managers) aiming to raise $6.1 billion, PEI’s data shows. 

The two largest vehicles in market are from domestic managers KB Investment and SK Securities, each with a target of 1 trillion KRW (€690 million; $947 million).

In addition, Seoul-based firms IMM Private Equity and Hahn & Co are expected to return to the fundraising market this year, according to industry sources.

In January, a record exit in Korea was likely set when Kohlberg Kravis Roberts and Affinity Equity Partners sold Oriental Brewery back to Anheuser-Busch InBev, the strategic they originally bought it from, in a $5.8 billion deal, reportedly reaping a 5x multiple, PEI reported earlier.


For the full story, read the Korea Briefing in the March issue of Private Equity International.