STIC Investments has made a full exit from defense company Hanwha Systems, one of the key portfolio companies in its first special situations fund, after selling its remaining 7.78% stake for 156 billion won ($139.7 million), according to sources.

The Seoul-based private equity firm sold the stake in a block transaction on January 20. It originally bought 32% of Hanwha Systems for 250 billion won in 2017, but sold 24.7 million shares for about 300 billion won after the firm’s initial public offering.

The full exit from Hanwha Systems generated an internal rate of return of over 10%.

STIC made the investment through its first special situations fund, which was closed at 603.2 billion won in 2016. Among its investors are National Pension Service, Public Officials Benefit Association, Korean Teachers’ Credit Union and the Ministry of Employment and Labor.

The fund is fully invested in five deals. The other four portfolio companies in the fund comprise social casino game developer and publisher DoubleDown Interactive, pharmaceutical company HK inno.N, safety equipment manufacturer Hancom Lifecare, and Big Hit Entertainment, the label of K-pop phenomenon BTS.

STIC acquired 12% of Big Hit for 104 billion won in 2018. It sold 196,177 shares for about 61.3 billion won in October last year when the entertainment company went public on the Seoul stock exchange, and then cashed out another 400,000 shares for 66 billion won in a block sale in December.

The firm had already earned more than its initial investment in Big Hit through two rounds of partial exits. It still holds an 8.05% stake, worth about 590 billion won on the current market capitalization. With the lock-up period expiring in January, STIC is expected to look for opportunities to sell its remaining stake. The full exit from the company would likely generate a return of more than five times its investment.

The rest of the portfolio companies in the fund are also preparing for initial public offerings this year. DoubleDown Interactive plans to list its shares on the Nasdaq, and HK inno.N and Hancom Lifecare will target the Seoul stock exchange.

STIC’s second special situations fund was closed last year at 1.22 trillion won, which is two times larger than its predecessor. More than half of the fund has already been deployed in less than a year. Its investments include Southeast Asian ride-hailing giant Grab Holdings and weight-loss company Juvis Diet. (Reporting by Si-eun Park)