Multiple private equity fund (PEF) managers joined the preliminary bidding to sell minority stakes in SK Multi Utility (SK MU), a district energy subsidiary of SK Chemicals, and Ulsan GPS, a combined-cycle power generation subsidiary of SK Gas.
According to the investment banking (IB) industry on the 21st, IMM Investment, IMM Credit & Solution (ICS), Stick Alternative Asset Management, and Macquarie Asset Management took part in the preliminary bidding to sell minority stakes in SK MU and Ulsan GPS. Samil PwC is supporting the sell-side with the execution.
SK Group plans to sell up to 49% equity in each of the two companies. As the sell-side is valuing the two companies at about 2 trillion won in total, the transaction size is expected to reach up to 1 trillion won. Buyers are known to be able to freely propose the equity purchase range and deal structure within the framework of minority stakes.
IMM Invest and ICS are understood to have participated in the bidding individually. IMM Invest is said to have raised around 400 billion won for its 10th infrastructure fund now being formed. ICS completed the closing of its first blind fund worth 950 billion won in the first half of this year. It is expected to raise funds by combining a blind fund and acquisition financing. Stick Alternative is said to have formed a consortium with Korea Investment Private Equity (Hantu PE).
SK MU and Ulsan GPS are power generators located in the Ulsan Mipo National Industrial Complex. SK MU was established in 2010 when SK Chemicals partitioned the utility supply business, including power and steam. SK Chemicals holds 100% equity. Established in 2011, Ulsan GPS started as a coal-fired power plant and later converted to a gas-based combined-cycle power plant. SK Gas injected about 1.4 trillion won. SK Gas holds 99.48% equity in Ulsan GPS.