Hanil Holdings Sells Hanil Networks... "Focusing on Core Business"

[Asia Economy Reporter Kim Jong-hwa] Hanil Holdings is selling its IT service affiliate Hanil Networks. On the 24th, Hanil Holdings announced that it will sell a 50.1% stake for 103 billion KRW to Ubase, the largest contact center operator in Korea.

Hanil Networks is an IT service specialized company providing contact center business, ERP solution operation, IT equipment distribution, and security solution services. It became a Hanil Holdings affiliate in 2008.

At the time of acquisition by Hanil Holdings, Hanil Networks was a small IT company with sales of 24.7 billion KRW and operating profit of 1 billion KRW. After the acquisition, it maintained a rapid annual growth rate of around 14%, growing into a sound company with sales of 117.4 billion KRW and operating profit of 10 billion KRW as of 2020.

Regarding this sale, a Hanil Holdings official said, "It was a model company that consistently grew among affiliates in different industries," adding, "Although it is regrettable, we decided to sell it to focus on core businesses through business portfolio restructuring. It will be an opportunity for both employees and the company to grow by maximizing synergy with Ubase, which is in the same industry."

Hanil Holdings mainly operates in building materials such as cement and ready-mixed concrete. IT services differ from the overall business structure of the company, limiting business expansion. On the other hand, the acquiring company Ubase has many similar business sectors that can create synergy with Hanil Networks, such as the contact center business, and is expected to further grow the company through specialized management. Both companies evaluate that this deal will allow them to win-win through selection and concentration.

Meanwhile, Hanil Holdings is actively promoting ESG management this year and exploring entry into eco-friendly businesses. In January, Hanil Cement, a core business company, showed interest in eco-friendly business by simply participating as a strategic investor (SI) in the acquisition battle for KG ETS’s environmental energy and new materials division, in partnership with the private equity fund (PEF) operator SKS Private Equity (SKS PE) - VL Investment consortium.