This article was published on March 21, 2025, at 5:25 p.m. on the ChosunBiz MoneyMove site.
The semiconductor equipment company HPSP is expected to postpone its main bidding schedule for sale. This is due to the lukewarm response from the candidates who participated in the preliminary bidding, and the market believes that HPSP’s stock price has overheated due to sale expectations, necessitating some adjustment before the sale process can accelerate.
According to the investment banking (IB) industry on the 21st, UBS, the sales advisor for HPSP's sale, originally intended to conduct the main bidding this month but is known to be postponing the schedule. An industry insider noted, "It could be said that the sale process has effectively stalled."
Previously, at the end of last month, UBS selected MBK Partners, Bain Capital, and Blackstone as qualifying candidates for the HPSP acquisition shortlist. Names such as Carlyle and Kohlberg Kravis Roberts (KKR) have also been mentioned in the industry, but it is reported that they did not participate in the preliminary bidding.
According to the industry, candidates participating in the preliminary bidding and conducting due diligence have reportedly expressed concerns that the valuation is too high. The shares being sold are 40.8% of HPSP's management rights owned by Crescendo, and the expected price from the sellers is said to be around 2 trillion won. Considering that HPSP's market capitalization is about 2.4 trillion won, this implies they are seeking a management premium of over 100%.
An IB industry insider said, "It's correct to say that 2 trillion won is overly expensive, considering that it is not an unlisted company and the stake is only 40%." They added, "There were expectations that HPSP's technology could be designated as a 'national core technology', but upon closer inspection, there are doubts about whether it truly possesses advanced technological capabilities."
The poor business conditions and high uncertainty in the semiconductor industry, which is the upstream sector, are also factors complicating the sale of HPSP. According to a business report released on the 20th, HPSP's operating profit last year was 93.9 billion won, a slight decrease from the previous year’s 95.2 billion won. Revenues amounted to 181.4 billion won, an increase of about 1% compared to the previous year.
In response, NH Investment & Securities adjusted its earnings forecasts downwards, reflecting a decrease in investment in the upstream industry, lowering the target price from 42,000 won to 37,000 won. The target price proposed by NH Investment & Securities for HPSP has been steadily adjusted down from 53,000 won last year.
An IB industry insider stated, "Although it is an asset held by a private equity firm and will eventually be sold, the current difference in expectations between the sellers and prospective buyers is significant, so it is difficult to predict when the process may gain momentum."