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Korea Federation of Community Credit Cooperative (KFCC) has become a big institutional name in the local M&A market, joining major deals including the latest acquisition of Doosan Corporation Mottrol.
The hydraulic component maker under Doosan Group was bought by a consortium led by Socius Advisors and Well to Sea Investment Co. for 453 billion won ($396.9 million), with KFCC reportedly responsible for a bulk of the 200 billion won in equity investment pooled from public funds.
KFCC also was behind the purchase of Hyosung Capital Co., teaming up with local private equity firm STLeaders PE. It plans to finance the acquisition cost of 400 billion won and a large portion of future rights issues.
Earlier this year, it purchased 20 billion won in preferred equity in MagnaChip’s foundry business unit when the chipmaker was acquired for 400 billion won by the SK Hynix-backed consortium led by Credian Partners and Alchemist Capital Partner Korea.
KFCC has 70 trillion won in assets under management from its 1,300 cooperatives across Korea. It has been increasingly turning to alternative investments such as M&As, real estate and infrastructure in search of higher returns in the low interest-rate environment.
After its decision to resume investment in blind private equity funds in eight years, KFCC committed 7 trillion won to alternative investment from this year to 2022.
It placed 180 billion won in blind funds of five asset management companies in the first half of the year and plans to invest another 300 billion won in the latter half.
It has recently shortlisted IMM Investment, Glenwood PE and JKL Partners for management of its 200 billion won A-type fund.
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