South Korean conglomerates are seeking to offload their non-core businesses as part of restructuring plans but many deals are pending due to lukewarm response from possible buyers.

Market insiders expect many companies to be put up for sale amid South Korean conglomerates’ ongoing business reorganization plans but there are many cases of the sale process being at a standstill for years, according to industry sources on July 7.

LG Group, which offloaded some of its non-core subsidiaries last year, continues to keep up its restructuring efforts this year. The group has tapped possible buyers for LG Electronics’ solar module business under its business solutions division but little progress has been made. With the seller receiving tepid response from domestic strategic investors and financial investors, it is likely to shift the focus to foreign investors.

Cash-strapped Doosan Group is also garnering attention with its possible sale of Doosan Infracore amid its massive restructuring efforts. But market insiders see little possibility of the deal actually being reached as Doosan Infracore’s subsidiary DICC (Doosan Infracore China Co Ltd) is in a legal fight and there won’t be many benefits from the acquisition. At the same time, some are questioning whether Doosan Group really intends to sell Doosan Infracore.

Other South Korean conglomerates, such as Hyundai Motor Group and CJ Group, are also considering business restructuring, making investment banks move fast to seek potential buyers.

In many cases, conglomerates decide to implement restructuring plans in a bid to enhance their global competitiveness by offloading their non-core business units. However, if conglomerates’ restructuring processes do not proceed as planned, they may have to withdraw from the business.

“Multiple companies have reviewed possible sale of their alternative energy business over the past few years but no deal has been reached due to wide valuation gap,” said an industry source. “It won’t be easy for them to find potential buyers as they already missed the right timing.” (Reporting by Hye-ran Kim)