이 기사는 2020년 04월 01일 08:00 더벨 유료페이지에 표출된 기사입니다.
South Korea’s E&F Private Equity (E&F PE) is gaining a foothold in the PE industry by diversifying its portfolio.
E&F PE, which invested in Netherlands-based cell therapy company Glycostem last year, has recently invested 20 billion won in Iconix, creator of beloved homemade animations such as Pororo the little Penguin, diversifying its portfolio.
The PE firm’s first blind-pool fund - E&F Fund I - has recently used up all of its commitments of 131 billion won, according to investment banking (IB) industry sources on March 27. The E&F Fund I has put five billion won in a pre-IPO funding round of Iconix as its last investment.
The fund has Yoo Chang Industrial (25 billion won), Goryo Fittings (12 billion won), Daewon Green Energy (20 billion won), Ecube Labs (8.3 billion won), Glycostem (9.3 billion won), Kolon Environment & Energy (50 billion won) and Iconix (5 billion won) as portfolio companies. While most of its assets belong to environment or construction materials industries, Glycostem and Iconix are in biotech and content sector, respectively.
E&F Fund I is meaningful in that it has expanded its investments beyond environment and construction materials industry. Before the inception of its first blind-pool fund in May 2018, the PE firm has mostly invested in waste disposal and construction materials companies through its project funds. In that sense, E&F PE’s recent investments in industries including content and biotech represent its entirely different move compared to how they have made investments in the past.
Industry insiders said that the PE firm’s move may be due to fiercer competition in the environment industry. New PE firms have entered the environment industry which is led by waste disposal firms amid increasing strategic investors’ appetite. This will naturally raise valuations of those companies, making E&F PE diversify its portfolio, they said.
“In addition to newly-formed PE firms, strategic investors still have appetite in the waste disposal industry. Given rising valuations of the companies, PE firms find them less attractive than they did,” said an IB industry source.
Indeed, E&F PE has changed its organizational structure to three divisions from three teams in a bid to diversify its investments. The division one will invest in a growth industry like content sector along with the construction materials industry. The division two and three also will concentrate on seeking new investment opportunities.
“While our existing assets are mostly hard assets, we are planning to focus on soft assets as well, which are more accessible and have growth potential,” said a E&F PE official, adding, “We are planning to diversify our investments using our blind-pool fund that will be created in the near future.”
(By reporter Choi Ik-hwan)