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Korea's PEF and
Venture Capital Ecosystem Emerging as
an Attractive Investment Destination
by the domestic pension fund market
Private equity fund (PEF) and venture capital (VC) creation and investment have been breaking records for several years in a row in Korea, and PEF and venture investment has been very active even amid the global funding slide in 2022.
Dramatic Growth of the Korean PEF MarketThe Korean PEF market is growing steadily. As of the end of 2021, investors had committed KRW 116.1 trillion to PEFs, up 20% from KRW 96.7 trillion in 2020.
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Restructuring of Korean
conglomerates is
an important driver of
growth in the Korean PEF
market.In Korea, the sale of non-core businesses by conglomerates aimed at restructuring their businesses is an important driver of growth in the Korean PEF market. PEFs are pursuing the strategy of acquiring non-core businesses of conglomerates and selling them back at an increased value.
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Digital Transformation of
Korean CompaniesDigital transformation of the Korean economy is in full swing. In recent years, numerous e-commerce, software, and other digital transformation companies, including Coupang, Yanolja, and Douzone Bizon, have raised funds from financial investors.
-
Restructuring of Korean
conglomerates is an important
driver of growth in the Korean
PEF market.In Korea, the sale of non-core businesses by conglomerates aimed at restructuring their businesses is an important driver of growth in the Korean PEF market. PEFs are pursuing the strategy of acquiring non-core businesses of conglomerates and selling them back at an increased value.
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PEF system reform
The reformed PEF system has been in place as of October 2021 in Korea. The relaxed system allows for a wider range of investment strategies for purposes other than management participation.
Gahyun Kim
Service Industry Promotion Team
+82-2-3460-3284
gahyun.kim@kotra.or.kr
Investment Success Stories
DIG Airgas
DIG Airgas is Korea's leading industrial gas provider founded in 1979 and acquired by MBK Partners in 2017. In 2020, MBK Partners sold DIG Airgas, achieving a return of over 100% in less than three years. Macquarie Group of Australia acquired the company from MBK Partners for USD 2.2 billion, with participation from a number of global LP investors, including the Government of Singapore Investment Corporation (GIC) and the pension fund of Alberta, Canada.
Yanolja
Yanolja is a Korean travel platform founded in 2005 that has grown into the country's largest online travel platform in just over 18 years. In 2019, the company became a unicorn with USD 180 million in funding from Booking Holdings, a major US travel platform, and the Government of Singapore Investment Corporation (GIC). In 2021, it was listed as a decacorn with a USD 1.7 billion investment from Japan's Softbank. Yanolja plans to go public in the coming years.