[PE Now] Why French PE Firm with 15 Trillion KRW in AUM Is Expanding Investments in Korean Companies

"A Private Asset Management Firm with 20 Years of History"
"Direct Investment in Korean Healthcare Companies"

"Korea is a country with a dynamic economic foundation and abundant investment opportunities. Currently, we are paying particular attention to the healthcare, financial services, consumer goods, and technology sectors."

Eric Deram, CEO of Flexstone Partners, an affiliate of the French global asset management company Natixis Investment Managers, visited Korea. In an interview with Asia Economy at Kyobo Building in Gwanghwamun, Seoul, on the 22nd, Deram identified Korea and other Asian countries as core markets and announced plans to expand investments in the region.

"A Private Asset Management Firm with 20 Years of History"

Flexstone Partners, a global private asset management firm, was founded in Geneva, Switzerland, in 2005. Currently, 64 investment professionals work across four hubs: Paris, New York, Geneva, and Singapore. The company invests in a broad range of private assets, including private equity, mezzanine, infrastructure, and private real estate.

Eric Deram, CEO of Plexton Partners, is giving an interview to Asia Economy at Kyobo Building in Gwanghwamun, Seoul, on the 22nd. Photo by Kim Daehyun

Deram stated, "Our assets under management (AUM) amount to $11 billion (approximately 15 trillion KRW), and to increase the Asian share?which currently stands at 5% of AUM?we plan to expand the Singapore office staff to eight people by the end of next year."

As the founder of Flexstone, Deram is an investment expert with over 30 years of experience. He began his career handling leveraged finance (private credit) at a French bank, earned an MBA from Harvard Business School in the United States, and then worked for five years in the private equity division of a European investment bank.

The company avoids strategies that concentrate capital in specific industries or countries. Deram explained, "Focusing on only a few sectors in long-term investments of five to ten years is, in fact, unrealistic. A representative example is the massive investments that flowed into the German solar sector in the early 2000s. At that time, Germany was the center of solar panel manufacturing, but when China launched large-scale investments around 2010, German companies faced significant difficulties."

He added, "We approach technology investments with caution. Recently, the rise of the artificial intelligence (AI) market has made investments in the technology sector extremely expensive. For this reason, we prefer industries such as healthcare and financial services, which require less capital. Above all, healthcare products and services are essential areas where demand continues regardless of economic downturns."

Flexstone has long adopted ESG (Environmental, Social, and Governance) philosophy as a core investment strategy. Deram said, "We signed the United Nations Principles for Responsible Investment (UN PRI) in 2014 and currently operate a dedicated ESG team. We apply ESG standards and ratings to all investment processes, and if an investment does not meet these criteria, we do not proceed."

"Direct Investment in Korean Healthcare Companies"

When asked about recent noteworthy investment cases, Deram replied, "Korean healthcare companies." He continued, "While I cannot disclose specific company names, we have invested in leading companies from Korea and Japan in the field of non-invasive skincare devices. Flexstone provided the capital needed for global expansion into the United States, Europe, and other regions. Korean beauty and healthcare technologies are proving their competitiveness in the global market." He especially emphasized, "Beyond financial performance, we are also contributing to the creation of social value. Through outstanding entrepreneurs and product lines, we expect to create many jobs not only in Korea but also in other regions."

He also highlighted the importance of secondary investments. Deram said, "Last year, the global secondary market saw $160 billion in transactions. Flexstone established a small secondary fund last year and plans to launch a larger fund next year." He added, "To maximize client returns, we are also increasing the share of direct deals. Recently, through a $790 million co-investment fund, we executed three deals in Asia?one in Japan and two in Korea."

To expand investments in Asia, Flexstone has newly established a pan-Asian fund worth $200 million. Deram explained, "Most Asian countries are in a much better fiscal position than the United States or Europe. Currently, Korea, Japan, and India are the most attractive markets. Above all, Korea has a very sophisticated and dynamic private equity market, and there are abundant investment opportunities across various sectors such as healthcare, financial services, consumer goods, and technology." However, regarding China, he stated, "A significant portion of the market is in technology and venture capital, which does not align with the nature of Flexstone's funds," and announced plans to limit investments there.

Currently, Flexstone manages 75% of its assets under management in the form of separately managed accounts (SMAs). The number of Asian clients?including Australian pension funds, Japanese and Chinese life insurance companies, Hong Kong and Singapore life insurance and family offices, and Malaysian life insurers?is increasing. Deram emphasized, "The main purpose of this visit to Korea is to persuade Korean institutional investors to invest in global private assets together with Flexstone. To this end, we are leveraging Natixis's network to introduce global investment strategies and products."