[Asia Economy Reporter Lim Jeong-su] VIG Partners, a domestic private equity (PE) firm specializing in management participation, has secured part of the funds needed to acquire shares in The Skin Factory. The Skin Factory is a household goods company that owns the ‘KUNDAL’ brand.
According to the investment banking (IB) industry on the 16th, VIG Partners received a loan of 50 billion KRW through KD Investment Purpose Company (KD Investment Holdings). The loan has a maturity of three years but is to be repaid in installments over three times. Early repayment in a lump sum is possible depending on circumstances.
KD Investment Purpose Company is a special purpose company (SPC) established by VIG Partners for the acquisition of shares in The Skin Factory. Lee Cheol-min, CEO of VIG Partners, is listed as a director.
The funds raised will be used for the share acquisition. VIG Partners recently signed a stock purchase agreement (SPA) to acquire 100% of The Skin Factory’s shares for a price in the high 100 billion KRW range. Except for part of the loan, the remaining acquisition funds will be sourced from the fund’s capital contributions.
VIG Partners provided the shares of The Skin Factory as collateral for the loan. This was done by establishing a pledge in favor of the lender who provided funds for the acquisition shares as a secured party.
The loan was executed in two tranches: Tranche A of 40 billion KRW and Tranche B of 10 billion KRW, based on collateral and repayment priority. KD Investment Purpose Company is expected to repay the loan using dividends received from The Skin Factory.
An IB industry official stated, "After acquiring The Skin Factory, VIG Partners plans to enhance corporate value by diversifying distribution channels based on strengths in online channels such as Coupang."
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