Seoul-based Hahn & Co has acquired a controlling stake in Korean beverage maker Woongjin Foods in a deal valued at 200 billion Won ($190 billion; €138 million), the firm has revealed.
Hahn & Co will invest 115 billion Won for a 58 percent stake, Scott Hahn, co-founder, told Private Equity International.
The deal was initially bid on by 23 interested parties and six were allowed to conduct due diligence. Hahn & Co secured the winning bid out of five submissions.
Woongjin Foods, part of a subsidiary of the Woongjin Group, produces and sells beverages, food and health products in Korea and also exports to China.
The company was sold by the Korean courts in a chaebol restructuring deal. But the food and beverage maker itself was not in default, its parent company was, Hahn said.
“It was an asset that the parent company could sell to pay down its own debt,” he explained.
He sees more distressed opportunities in Korea among the chaebols that have exposure to multiple industries because a downturn in one area is likely to impact divisions in other industries.
Woongjin Group, for example, had trouble with its construction, real estate and solar divisions. It was therefore forced to sell other assets such as its water purifier business to MBK Partners in 2012 and its chemical business, which it is offloading to Toray, a Japanese strategic.
“Those industries had nothing to do with construction, but they are related because of the parent group’s web of ownerships,” Hahn explained.
The investment is Hahn & Co’s sixth buyout from its debut fund, which closed on $750 million in July 2011. The fund is now more than 50 percent invested.
Seoul-based Hahn & Co is a 2010 spinout from Morgan Stanley Private Equity Asia. It targets mid-market buyouts and corporate restructurings in Korea.