Tiandi Partners-led consortium to acquire Kwangyang Marine

A consortium led by South Korea’s newly established private equity (PE) firm Tiandi Partners will acquire Kwangyang Marine Co Ltd.

A consortium of Tiandi Partners, KB Securities’ growth investment division, NAU IB Capital and TS Investment is carrying out a process to acquire Kwangyang Marine, according to industry sources on July 7. The consortium signed a share purchase agreement on June 26 to take over an 80.3% stake in Kwangyang Marine owned by its largest shareholder Dongbang for approximately 52 billion won ($43.6 million).

Kwangyang Marine was established in 1982 as an affiliate of Korea Marine Corporation and sold to logistics company Dongbang in 2012. With POSCO being its main client, Kwangyang Marine accounted for more than 40% of POSCO’s coastal transportation as of 2019. The shipping firm has become Dongbang’s cash cow, with the company recording earnings before interest, taxes, depreciation and amortization (EBITDA) of more than 10 billion won annually over the past four years. Dongbang has decided to offload Kwangyang Marine to secure liquidity and improve its financial structure.

The consortium plans to enhance Kwangyang Marine’s sales capability and boost overseas sales for the company’s further growth. Tiandi Partners was founded by James Kim who founded EQ Partners, Korea’s number one infrastructure PE firm, and served as its chief executive officer for nine years.

The transaction is subject to an approval from South Korea’s antitrust regulator, the Fair Trade Commission. The deal is likely to be completed around July 30 when the authority grants an approval for the deal. (Reporting by Ik-hwan Choi)