[Asia Economy Reporter Park So-yeon] Han & Company (hereinafter Han & Co), a native private equity firm that gained the upper hand in the lawsuit against Namyang Dairy Products, is preparing for the post-COVID era by completing the acquisition of SKC's film business in the second half of this year.
According to the investment banking (IB) industry on the 5th, Han & Co is expected to soon proceed with the deal closing for the acquisition of SKC's film business. SKC recently held a shareholders' meeting and gave final approval for the spin-off of the film business. It will sell 100% of the shares of the spun-off film business company to Han & Co. The business Han & Co is acquiring includes SKC's film business division and the U.S. and China operations of SKC High Tech & Marketing, a film operation subsidiary. The contract amount was set at 1.6 trillion KRW.
The film business is the foundation of SKC, producing products used in advanced IT devices such as displays and mobiles, as well as industrial applications. In 1977, it developed Korea's first polyester (PET) film, followed by the development of the country's first videotape in 1980, leading the domestic film industry. In the 2000s, it shifted its main product to display films and recently has focused on advanced products for mobile devices such as smartphones. Last year, it recorded sales of 1.1319 trillion KRW and an operating profit of 68.9 billion KRW. This accounts for about one-third of SKC's total sales last year (3.396 trillion KRW). Han & Co plans to strengthen global competitiveness and develop SKC's film business into a sustainable growth company through this acquisition.
Han & Co currently manages portfolio companies with total assets of approximately 40 trillion KRW. Its total sales exceed 16 trillion KRW, and it employs about 30,000 people, making it a mega private equity firm. Since its establishment in 2010, it has acquired 30 leading domestic companies, discovering new growth engines and improving the corporate structure of acquired companies through a bolt-on strategy (acquiring companies with high business relevance) to increase corporate value.
Han & Co restored global competitiveness by acquiring H-Line Shipping and SK Shipping. It transformed Ssangyong C&E (formerly Ssangyong Cement) from a leading cement company into a comprehensive environmental company. It acquired Hanla Visteon, which had been sold to a foreign company, and transformed it into Hanon Systems. It also acquired Korean Air's in-flight meal and duty-free business units during a liquidity crisis, playing an appropriate role as a native private equity firm at critical moments for major companies.
Among domestic private equity firms, Han & Co has executed the most buyout investments without incurring a single loss in the process. It is known to have the highest returns among buyout funds in Asia. Based on this record, it set a record as the largest domestic investment-only fund with a size of 3.8 trillion KRW in its third fund's fundraising in 2019. Recently, it completed the formation of a 2 trillion KRW continuation fund to replace the limited partners (LPs) of Ssangyong C&E.
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