Emphasis on Smooth Transactions Over Valuation
SK: "Saving on Advisory Fees and Ensuring Safe Deals"
Hahn & Company: "Preventing Overvaluation from Excessive Price Competition"
Private equity firm (PE) Hahn & Company is sweeping up SK Group’s assets as it pursues the acquisition of SK Siltron. Notably, both parties have conducted several 'direct transactions' without involving brokers or advisory firms, drawing attention.
According to the investment banking (IB) industry on the 9th, SK Inc. is negotiating with Hahn & Company to sell a 70.6% stake in semiconductor wafer manufacturer SK Siltron. After agreeing on detailed terms, the contract is expected to be signed within the first half of the year.
Once this deal is finalized, Hahn & Company will have acquired its tenth asset from SK Group. A particularly unique aspect is that SK Group and Hahn & Company are conducting 'direct transactions.' Following the sale of SK Specialty, SK Group did not appoint a separate IB to mediate the SK Siltron sale either. Instead, internal departments directly contacted potential buyers to proceed with the deal.
This has been interpreted as a result of aligned strategic interests between the two companies. SK Group, aiming to restructure its business around artificial intelligence (AI) and batteries, needed to secure liquidity through portfolio rebalancing. They wanted to do so smoothly, avoiding unnecessary procedures and costs.
Hahn & Company also traditionally prefers to respond directly without appointing advisory firms. They believe that even in buyer-favorable deals, conducting competitive bidding with underwriters inevitably leads to paying a premium above the appropriate corporate value.
Trust between Hahn & Company and SK Group deepened as Hahn & Company consecutively acquired SK’s offline used car business (now K Car), SK D&D, and SK Shipping in 2018. Since then, the two companies have completed 10 transactions over eight years, including last year’s SK Enpulse CMP division and this year’s SK Specialty. It is evaluated that trust was built more on actual transaction experience and results rather than external factors such as alumni ties or personal connections between executives.
An IB industry insider explained, "Deals with conglomerates often involve various confidential demands that are difficult to disclose externally, and trust must be established to successfully handle these. By somewhat foregoing opportunities to gain higher prices or negotiate deeper discounts, both parties chose to complete transactions smoothly and reliably."
© The Asia Business Daily(www.asiae.co.kr). All rights reserved.
