Korea’s IMM, fresh off fundraising trail, eyes next flagship after bagging mega-deal

IMM RoseGold IV closed on $1.8bn in December.

Korea’s IMM Private Equity plans to return to market next year after bagging one of its largest deals to date.

IMM has agreed to acquire a controlling stake in listed furnishing business Hanssem for more than $1 billion, partner and chief investment officer Hae-Joon Joseph Lee told Private Equity International. The deal will take IMM RoseGold IV, which closed on $1.8 billion in December, from about 45 percent invested to 65 percent.

The transaction is expected to close by November.

The firm will formally launch IMM RoseGold V in H2 2022, Lee said. It began fundraising for RoseGold II in 2011, RoseGold III in 2015 and RoseGold IV in 2019, according to its website.

Hanssem represents RoseGold IV’s second investment north of $1 billion, following its $1.2 billion acquisition of industrial gas platform AirFirst in 2019. It is the sixth investment from Fund IV, joining the likes of pharmaceutical business Genuone Sciences and travel agency Hanatour.

IMM has exited four businesses since October, including fashion platform W Concept – a Fund III portfolio company – to Shinsegae Group in April at a roughly 2.5x multiple of invested capital, Lee added. Other notable exits include Fund II’s Taihan Electric Wire to Hoban Group earlier this year at a 2.5x MOIC and coffee chain Hollys F&B to KG Group, which also owns KFC South Korea, for 2x in October.

Korean private equity activity hit new highs in 2020, according to July data from the Financial Supervisory Service. Domestic funds invested 18.1 trillion won ($15.7 billion; €13.3 billion) across 565 companies last year, up from 16 trillion won across 500 companies in 2019. Exit value reached 17.7 trillion won, up from 11.7 trillion won the previous year.

Industry participants believe 2021 could lead to a greater proportion of Korean buyouts than in previous years due to an ongoing shareholder dispute involving a consortium of private equity buyers – IMM included – and their portfolio company, Kyobo Life Insurance.

Some 218 Korean private equity funds raised 17.9 trillion won in 2020, compared with 15.6 trillion won across 206 the previous year. Most of these funds are managed by small ‘mom-and-pop’ shops that typically raise capital from Korean retail investors.

Founded in 2006, IMM has 30 investment professionals managing $5.4 billion across 25 private equity funds, per its website.