이 기사는 2021년 06월 07일 07:52 thebell 에 표출된 기사입니다.

SK Ecoplant is ramping up expansion in the environmental business, setting up a rivalry with US private equity giant KKR & Co, which has been aggressively building up its South Korean portfolio of waste management companies, in the race for dominance in the industry.

The South Korean company announced on Thursday its four bolt-on acquisitions of Daewon Green Energy, Saehan Environment, Clenco and DDS, totaling 418 billion won ($374 million).

The move is part of efforts by SK Ecoplant to transform itself into an environmental management services provider. The company, formerly SK Engineering & Construction, changed its name after it bought waste management firm EMC Holdings from Affirma Capital for about 1 trillion won in 2020.

Affirma Capital grew EMC Holdings to a comprehensive waste management services provider. EMC Holdings, which was acquired by the private equity firm in 2016 and formerly a water treatment company called Kolon Water & Energy, expanded its business to include incineration and landfill through a series of bolt-on acquisitions.

SK Ecoplant was widely expected to make bolt-on acquisitions as the company made it clear that it would use its takeover of EMC Holdings as a springboard for its environmental business ambitions.

The four announced deals will help SK Ecoplant increase its waste management presence in the Seoul metropolitan area and provinces in the middle part of the country. Daewon Green Energy provides incineration services for industrial waste in South Chungcheong Province. Saehan Environment, based in Cheonan, Gyeonggi Province, has incinerators that burn waste and also produces steam by using the heat from them.

Clenco has waste incineration facilities in Cheongju, North Chungcheong Province. DDS provides medical waste disposal services, which have a high barrier to entry, in Nonsan, South Chungcheong Province.

The announcement of the transactions comes after talks on another high-profile deal between KKR and Taeyoung Group’s TY Holdings. The US private equity firm and the holding company are in advanced discussions to create a big waste management company by combining three firms.

In June last year, KKR acquired ESG Co and ESG Cheongwon from Anchor Equity Partners for 875 billion won. The firms provide incineration and landfill services for industrial and medical waste across the Seoul metropolitan area and the provinces of Chungcheong, Gyeongsang and Jeolla.

Six months later, KKR also bought 37.39% of TSK Corporation from minority shareholders for 441 billion won, making it the second largest shareholder in the waste management company after TY Holdings with a 62.61% stake.

TSK Corporation has maintained a strong position with a 30% share in the domestic water treatment market, which is an oligopoly of EMC Holdings, TSK Corporation and Techcross.

KKR and Taeyoung Group is said to be holding 50% each of the combined company. (Reporting by Hee-yeon Han)