This article was posted on the ChosunBiz MoneyMove (MM) site at 1:04 p.m. on Oct. 27, 2025.
As H Private Equity (PE), a domestic private equity firm, pursues the acquisition of DC Inside, the country's largest online community, lenders considering providing acquisition financing are facing growing concerns. From the lender's perspective, online communities pose significant challenges for valuing corporations because they lack tangible collateral that can be visually verified.
According to the investment banking industry on the 27th, H PE recently completed corporate due diligence on DC Inside. H PE received the final technical due diligence (TDD) report last week, a study to evaluate the effectiveness, stability and economic feasibility of facilities such as buildings to reflect them in the sale price. It is currently tapping several financial institutions (demand surveys) to raise acquisition financing.
The acquisition target is the majority shareholder stake including control, and the company is seeking a sale price of 200 billion won. For DC Inside to justify that, a 22-times multiple must be applied to EBITDA of 9.2 billion won. Considering that online platform firms typically receive multiples of 16 to 18, this is relatively high in Korea. However, the U.S. online community Reddit, often mentioned for its similarity to DC Inside, has an enterprise value to EBITDA (EV/EBITDA) multiple of 240.
H PE plans to raise about 100 billion won of that through acquisition financing. An industry source said, "Since the final corporate due diligence ended not long ago, it looks likely they will sign a share purchase agreement (SPA) after price negotiations," adding, "They have been tapping lenders for acquisition financing since the Chuseok holiday, but financial institutions are taking a cautious approach."
The market judges that proving DC Inside's stable cash flow is the key. DC Inside's sales last year were 20.7 billion won and operating profit was 9 billion won, yielding an operating margin of 44%. The company touts that DC Inside's debt ratio is only 30% and that it has maintained debt-free operations as strengths. DC Inside is a 100% subsidiary of Community Connect, and founder Kim Yusik is reported to hold about 10% equity in Community Connect. The remaining 90% is held by private investors.
However, the nature of online communities, where revenues fluctuate significantly depending on information volume and visitor numbers, could be an obstacle. DC Inside ranks fifth in domestic traffic after Naver, Google, YouTube and Daum. It generates revenue from advertising based on that. Although various boards called "galleries" exist, it has recently been criticized for growing bias as the share of political posts has increased.
An industry source said, "JobKorea was also an online platform without assets, so it wasn't easy to approach, but its major customers were corporations rather than individuals and it produced stable revenue in the recruitment market, which made lenders execute loans," adding, "By contrast, DC Inside has no clear customers that guarantee revenue and is a community with politically sensitive aspects, so there is understandably a skeptical mood."
Some have suggested financing most of the acquisition with equity. H PE raised its first blind fund, H No. 1 Private Equity Investment Partnership, at about 200 billion won last year. It subsequently invested in implant maker DIO and multi-channel network (MCN) firm Lefery, among others, and has used just over 50% of the fund. H PE is planning to raise a second blind fund of a similar size.