Hyosung, POSCO, and Other CVC Investee Companies Meeting
Plan to Raise 250.8 Billion KRW for New Funds Over 3 Years
[Asia Economy Reporter Moon Chaeseok] One year after allowing holding of corporate venture capital (CVC) by holding companies, the average asset management scale of CVCs exceeded 400 billion KRW.
The Korea Institute for Technology and Investment Association (KITIA) announced the survey results on the 15th at a meeting held by the Ministry of Trade, Industry and Energy together with CVC-investing companies such as Hyosung, POSCO, CJ, Shinsegae, Hyundai Motor, and experts.
CVC generally refers to venture capital companies whose major shareholder is a corporate entity. With the amendment of the Fair Trade Act effective from December 30, 2021, holding companies were allowed to hold CVCs under certain restrictions.
KITIA revealed that, based on a survey conducted from the 31st of last month to the 8th of this month on the investment status and fund formation plans of 31 CVCs, the average managed assets were calculated at 438.2 billion KRW.
About 40% of the assets were internal funds including investments from parent companies and affiliates, while the remaining 60% were external funds raised from private financial institutions and others.
CVCs plan to form new funds averaging 250.8 billion KRW annually over the next three years. The main investment sectors are secondary batteries (15%), advanced manufacturing (13%), semiconductors (12%), and future mobility (11%).
The Korea Capital Market Institute analyzed that CVCs are being utilized as a key means for open innovation in companies, exploring new technologies and market opportunities beyond simple financial purposes.
The Ministry of Trade, Industry and Energy plans to establish a CVC fund worth 200 billion KRW this year through public-private joint investment. It intends to provide priority investment-linked research and development (R&D) project support to companies invested in by CVCs.
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