Korea Growth Investment Corporation (K-Growth), a government-led fund of funds, will put 40 billion won ($34.4 million) into a 350 billion-won project fund investing in software solution provider Tmax Group, industry sources have reported.

Tmax Group has three operations – TmaxSoft, which develops enterprise software, TmaxData, which develops database management system, and Tmax A&C, which develops operating systems. All are controlled by Daeyeon Park, the group’s founder and chairman.

J&J Partners and With Private Equity, which will serve as joint general partners, started to market the fund to institutional investors this week. The fund plans to purchase 280 billion won of exchangeable bonds and 70 billion won of redeemable convertible preferred stock newly issued by TmaxData.

Tmax Group will use part of the proceeds to repay existing investors. Lindeman Asia Investment invested 70 billion won in the group two years ago, and there were later investments by Timefolio Asset Management and a consortium of POSCO Capital and J&J Partners. Their investments in TmaxSoft, TmaxData and Tmax A&C totaled about 170.5 billion won.

However, these companies will withdraw their money after plans for a stock market debut by TmaxSoft before the end of this year became unlikely due to accounting issues. The initial public listing (IPO) was included in the conditions of investment.

TmaxSoft was unable to prepare its 2018 audited financial report in time after receiving qualified opinions from an external auditor. It finally obtained unqualified opinions in April, but it was too late to complete the listing in time.

The remaining proceeds will be used to develop a database management system and operating systems. TmaxSoft will reportedly revive its IPO plans after the transaction is completed. (Reporting by Se-hun Jo)