이 기사는 2020년 02월 27일 08:00 thebell 에 표출된 기사입니다.

South Korea’s leading fried chicken franchise Kyochon F&B has kicked off its initial public offering (IPO) process.

According to investment banking (IB) industry sources on February 21, Kyochon F&B plans to apply for a preliminary IPO review in April to the Korea Exchange (KRX). The chicken franchise aims to complete its IPO by the end of this year. Mirae Asset Daewoo will act as a bookrunner for the listing. The company announced its IPO plan in 2018.

Kyochon F&B is the nation’s largest chicken franchise in terms of sales. The company’s financial performance has improved gradually over the past few years, posting 339.1 billion won in sales and 20.3 billion won in net profit in 2018 from 325.5 billion won and 19.6 billion won respectively in 2017 on a consolidated basis. The company’s financial structure has stabled with its debt ratio falling to 104 percent in 2018 after peaking at 200 percent.

If Kyochon F&B successfully makes its IPO debut, the company becomes the first franchise that succeeds in raising capital through a traditional IPO route. Haimarrow Food Service, the operator of the country’s famous fast-food chain Mom’s Touch, entered the secondary bourse Kosdaq market through a backdoor listing.

The country’s other famous franchises including BHC, Nolboo, and BonIF attempted to launch IPOs, but withdrew their plans as they all failed to meet IPO requirements. However, market watchers have heightened their expectation on the chicken franchise as it has maintained its top position in the homegrown chicken franchise industry.

Kyochon F&B has put efforts into franchise management. The chicken franchise raised around 618 million won annual sales per franchise in 2018, far above the domestic chicken franchise industry average of 189 million won.

The chicken franchise has also sold its loss-marking affiliates and brands to enhance its business efficiency in preparation for its IPO. The company has focused more on its core business by establishing its R&D center and enhancing its ERP system.

Kyochon F&B will strengthen its foothold in global markets if the listing succeeds. The company is currently operating in the U.S., Malaysia, Indonesia, Thailand, the Philippines, and China. The proceeds raised from the IPO will help the homegrown chain to grow to a global franchise.

“Kyochon F&B sold company shares to employees at the beginning of this year,” said an IB industry source, adding, “The company is likely to go public by the end of this year as planned if it applies for the preliminary review in April.”

(By Yang Jung-woo)