Woori Finance Holdings, the holding company of Woori Bank, Korea’s third-largest lender, has announced it is raising a new buyout fund according to a report in the Korea Herald.
The fund could become the largest domestic vehicle targeting Korean buyouts. Vogo Investment, a buyout fund launched earlier this year by former Korean Ministry of Finance and Economy official Byeon Yang-ho, is currently seeking 510 billion won ($490 million).
Lee In-Young indicated the fund would seek to invest in more than ten companies that have been engaged in debt rescheduling programmes due to come to an end over the next one to two years.
Last December, Woori Bank launched a 210 billion won private equity vehicle that was liquidated after an accounting fraud scandal at a local construction company in which it had invested.
Foreign private equity funds such as Carlyle Group, Lone Star Funds and Newbridge Capital have enjoyed considerable success in recent years from their investments in under-performing Korean assets. However, a number of these funds have since found themselves on the receiving end of a tax clampdown by the Korean authorities – keen to recoup what they see as deliberate tax avoidance.