AirFirst Minority Stake Acquired by BlackRock... IMM PE Earns 3.5x Return on Principal

BlackRock Asset Management is acquiring a minority stake in AirFirst.

According to the investment banking (IB) industry on the 8th, IMM Private Equity (hereinafter IMM PE) signed a sales and purchase agreement (SPA) with BlackRock for the sale of a minority stake in AirFirst on the same day.

They are selling a 30% stake, with the transaction size estimated at over 1 trillion KRW. The enterprise value of AirFirst was recognized at approximately 3.7 trillion KRW.

An IB industry insider said, "Since the sale proceeds exceed 1 trillion KRW, it is expected that the distribution to investors will exceed the principal investment amount just from the sale of the 30% stake," adding, "This transaction includes not only the sale of existing shares but also a paid-in capital increase of about 200 billion KRW, enabling the company to maintain a stable controlling stake while proactively securing future growth funds for the target company."

After signing the stock purchase agreement, the transaction is expected to be completed and investor distributions made around August this year, following government approval procedures such as corporate merger reviews. The fund's return from this sale is projected to be an IRR (Internal Rate of Return) of 39% and an MOIC (Multiple on Invested Capital) of about 3.5 times.

IMM PE has been pursuing the sale of about a 30% stake in AirFirst since last year. Although KKR, Brookfield Asset Management, and others expressed interest in acquiring a 50% stake, IMM PE decided to partner with BlackRock, which proposed a 30% acquisition as originally planned.

IMM PE acquired AirFirst using its 3rd and 4th blind funds in March 2019. It has been reviewing the sale of a minority stake in AirFirst since last year and formalized the process earlier this year. In the preliminary bidding in March, about ten global investment firms participated, and in the final bidding, BlackRock, Brookfield, KKR, and CVC Capital submitted bids. All devised strategies utilizing infrastructure-type funds. At that time, IMM PE's acquisition amount was around 1.4 trillion KRW.