이 기사는 2020년 03월 30일 08:00 thebell 에 표출된 기사입니다.

South Korea’s Noh & Partners and DB Investment's acquisition of pipe coating company Coating Korea is garnering attention as the deal is centered around the state-run Korea Development Bank (KDB).

The country's newly formed private equity firm Noh & Partners is currently in the process of taking over Coating Korea for around 75 billion won jointly with DB Investment, said investment banking industry sources on March 25. The buy-side and SkyLake Investment, the sell-side of Coating Korea, plan to sign a stock purchase agreement (SPA) soon. The seller has hired homegrown M&A boutique KR&Partners to handle the sale process.

The secondary buyout – a sale of a portfolio company by PE firm to another - is drawing particular attention from market players due to the fact that the buyers are from the state-run KDB.

Noh & Partners chief Noh Kwang-geun reportedly worked at KDB for more than 25 years. Since Noh & Partners’ establishment in 2015, professionals from KDB’s PE division have joined the firm. DB Investment chief Lee Sang-kyu also worked at the state lender for a long time.

Coating Korea is a portfolio company of a fund in which KDB is participating as an anchor limited partner. SkyLake Investment has invested in the pipe coating company via its tenth PE funds, which have the National Pension Service (NPS) and KDB as anchor limited partners.

Industry insiders are focusing on each and every one of limited partners that the two firms will attract. It is said that the buy-side is currently raising funds mainly from South Korea’s pension funds and mutual aid associations for the acquisition of the pipe coating company. It is also worth watching whether KDB’s PE division will join the deal as a co-investor.

In fact, KDB took part in Noh & Partners’ 200 billion won investment in battery separator W-Scope at the beginning of this year. The state-run bank has invested in W-Scope via its PE fund managed by its PE division.

Industry insiders are also waiting to see whether Noh & Partners will be selected as an external manager of rookie league in KDB’s investment program.

(By reporter Choi Ik-hwan)