This article was displayed on the ChosunBiz MoneyMove (MM) site at 3:17 p.m. on Feb. 20, 2026.
As the sale process of Daekyung O&T, Korea's largest collector and producer of used cooking oil (UCO) and animal-based bio feedstock, is underway, two companies have been selected for the shortlist of qualified preliminary bidders.
According to the investment banking (IB) industry on the 20th, the seller on the day gave final notice of shortlist selection to two companies: an HD Hyundai Oilbank consortium and Japan's ENEOS. Many bidders, including domestic and foreign strategic investors (SI), took part in the preliminary bid.
The sale target is 100% of Daekyung O&T equity. The price under discussion is around 500 billion won. Daekyung O&T is owned 60% by Eugene Private Equity (PE)–Korea Development Bank PE and 40% by SK On. They acquired the stake from STIC Investments in Dec. 2023 for an amount in the high 400 billion won range.
Daekyung O&T is the No. 1 company in Korea in supplying bio feedstock based on used cooking oil and animal fats. The used cooking oil and animal fats it supplies are used as key feedstocks for biofuels such as sustainable aviation fuel (SAF) and biodiesel.
This bid is shaping up as a showdown between Korean and Japanese refiners. Hyundai Oilbank is one of Korea's four major refiners, and ENEOS is Japan's largest refiner. As pressure mounts to convert a certain share of jet fuel—one of refiners' main product lines—into SAF, securing a feedstock supply base has emerged as a key task.
The European Union (EU) has set the mandatory SAF blending ratio at 2% starting in 2025 and plans to raise it to 70% by 2050. Japan also aims to lift its SAF ratio to 10% by 2030. Korea will introduce a 1% SAF blending mandate for international flights starting in 2027 and is pushing to raise it to 3–5% by 2030.
Some observers said that as foreign SIs jumped into this acquisition race, the government could review the sale process. The view is that the bio feedstock supplied by Daekyung O&T could be seen as a strategic asset for national energy security.
But the prevailing view in the industry is that such an interpretation is excessive. Daekyung O&T does not engage in sectors such as defense or key telecommunications, where foreign equity investment is banned or restricted, and it does not hold national core technologies or national advanced strategic technologies, meaning a foreign acquisition would not require separate approval.
It is also unrelated to defense industry goods, strategic materials, or state secrets, so it is not subject to a security review, they said. The seller is said to have already completed related legal reviews during transaction preparation.
Daekyung O&T posted sales of 584.5 billion won and operating profit of 40.2 billion won in 2023, but its performance slowed in 2024 to sales of 502.7 billion won and operating profit of 30.5 billion won. Observers cited the launch of the administration of U.S. President Donald Trump, which is less proactive on the shift to renewable energy, and Europe's move to moderate the pace of its energy transition plans.