Fine Investment Co and KB Investment, which have recently been selected as a blind-pool private equity fund (PEF) manager for Korea Growth Investment Corporation (K-Growth)’s 2020 corporate restructuring fund are expected to launch their fund soon.
Fine Investment and KB Investment have finished raising funds for their 100 billion won ($83.8 million) blind-pool fund and only the administrative procedures are left, according to industry sources on August 3.
The two firms began to launch the fund after they were picked by K-Growth to manage its corporate restructuring fund. Fine Investment and KB Investment are one of the three managers hired by K-Growth for the PEF sector, with the firms expected to launch the fund in less than one week after the selection.
K-Growth will commit 200.6 billion won to the PEF managers. PEF managers have freely proposed the size of the investment asset to be from 50 billion to 100.6 billion won. Fine Investment and KB Investment have reportedly proposed the investment asset of 50 billion won, for which each firm has contributed 25 billion won. The minimum fund size for the blind-pool PEF has been set at 100 billion won.
Fine Investment and KB Investment have reportedly secured capital from some limited partners even before submitting their proposal. Market insiders speculate affiliates of the two firms have committed capital to the fund. Fine Investment was spun out of Fine Partners Corporation in 2017. Founded in 1990, KB Investment, formerly Jang Eun Venture Capital Co Ltd, was incorporated as an affiliate of KB Financial Group Inc in 2008.
Fine Investment and KB Investment have created their fund in such a short time. The timing of investment is especially important when investing in companies undergoing restructuring compared to other investments.
“Fine Investment and KB Investment apparently plan to make investments after launching their fund as soon as possible,” said an industry source. “The two firms seem to have already drawn up a list of target companies and are expected to make investments after reviewing those companies’ financial performance in the first half and financial status.”
Fine Investment has been selected as the manager by K-Growth after its previous attempt failed last year. It was the only management firm which applied for both PEF and PDF (private debt funds) sectors for the 2020 corporate restructuring fund.
A total of three companies including Ever Best Partners/Hana Financial Investment Co Ltd, Korea Investment Private Equity/SG Private Equity and Fine Investment/KB Investment were selected as PEF managers. Ever Best Partners/Hana Financial Investment have reportedly proposed investment assets of 75 billion won while Korea Investment Private Equity/SG Private Equity have proposed 100 billion won. (Reporting by Byung-yoon Kim)