Private equity (PE) firm Keistone Partners will acquire airport bus service provider KAL Limousine through its portfolio company eBridge, with the acquisition price reported to be in the range of 20 billion won ($17 million) to 30 billion won.

Keistone Partners signed a stock purchase agreement on Tuesday (February 2) with Air Total Service, a subsidiary of Korean Air Lines, industry sources said. The PE firm plans to close the deal by the end of this month.

KAL Limousine operates about 70 premium limousine buses connecting major hotels in Seoul, as well as Gimpo and Incheon airports. The company has been hit hard by the Covid-19 pandemic and was put up for sale by Korean Air last year as part of a rescue plan.

Keistone Partners hopes for synergies between KAL Limousine and its tourism and airport platform marketing company eBridge when the pandemic ends and the travel industry recovers. The airport bus service business has a high entry barrier as it is difficult to receive business licenses and permission for routes, and only three are operating in Seoul apart from KAL Limousine.

eBridge owns platforms specializing in tourism and airport services, such as The Lounge Members, and was serving more than one million tourists a year before the pandemic struck. In expanding its business to airport transportation services, the company will become a comprehensive tourism and airport services platform.

Keistone Partners plans to pursue a bolt-on strategy by taking over more platform companies which could make synergies with eBridge to boost its enterprise value.

The PE firm used the remaining dry powder in its 347.1 billion won second blind-pool fund, created in 2017, for the investment, after earlier investing in Cardoc, ADT Caps, LS Alsco and SIS. Investments will be made through a third blind-pool fund this year. (Reporting by Se-hun Jo)