By Baek Byung-yeul
The government is moving to put the brakes on the planned sale of Taihan Electric Wire to a Chinese firm as the trade ministry plans to designate the cable maker's technologies as "national core technology," according to industry officials, Monday.
IMM Private Equity, which has owned a 67.14 percent stake in the country's No.2 cable maker since 2015, is reportedly trying to sell Taihan to a Chinese company. Though Taihan denied the speculation, the move was criticized by local cable makers, expressing concern about possible technology leaks.
In response to the private equity firm's move, a Ministry of Trade, Industry and Energy officials said: "The trade ministry will hold a meeting Thursday to decide on designating extra-high voltage cable technology as a national core technology."
Among domestic cable makers, only Taihan and LS Cable & System are capable of manufacturing extra-high voltage cables.
The ministry said once the technology is designated as a national core technology, it will be difficult for IMM Private Equity to sell Taihan to a Chinese firm because transferring Tainha's related technology will be banned.
Taihan came out against the government's move to designate the technology related to extra-high voltage cables, saying it was nothing new. "The related technology is owned by 27 cable makers in 12 countries worldwide," a Taihan official said.
It also denied the speculation that IMM PE was considering selling its shares in the cable maker.
"IMM Private Equity, the largest shareholder is not considering selling Taihan Electric Wire to a Chinese company. Such speculation that IMM Private Equity will sell Taihan is groundless," the Taihan official said.
Since the speculation started in March, domestic cable companies have opposed the move, fearing a technology leak.
"There is no Chinese cable maker that can produce 500-kilovolt extra-high voltage cables. If Taihan is sold to a Chinese company, it is crystal clear that the firm will take advantage of Taihan's technology," an official in the industry said.
"Also, there is a concern that the ecosystem of the entire cable industry here would be collapsed. If Taihan is purchased by a Chinese firm, the new owner will produce cheaper extra-voltage cable using its cheap labor. It will eventually sell the cables on the Korean market and this will kill the domestic cable industry," the official added.
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| IMM Private Equity CEO Song In-jun |
IMM Private Equity, which has owned a 67.14 percent stake in the country's No.2 cable maker since 2015, is reportedly trying to sell Taihan to a Chinese company. Though Taihan denied the speculation, the move was criticized by local cable makers, expressing concern about possible technology leaks.
In response to the private equity firm's move, a Ministry of Trade, Industry and Energy officials said: "The trade ministry will hold a meeting Thursday to decide on designating extra-high voltage cable technology as a national core technology."
 |
| Taihan Electric Wire CEO Na Hyung-kyun |
The ministry said once the technology is designated as a national core technology, it will be difficult for IMM Private Equity to sell Taihan to a Chinese firm because transferring Tainha's related technology will be banned.
Taihan came out against the government's move to designate the technology related to extra-high voltage cables, saying it was nothing new. "The related technology is owned by 27 cable makers in 12 countries worldwide," a Taihan official said.
It also denied the speculation that IMM PE was considering selling its shares in the cable maker.
"IMM Private Equity, the largest shareholder is not considering selling Taihan Electric Wire to a Chinese company. Such speculation that IMM Private Equity will sell Taihan is groundless," the Taihan official said.
Since the speculation started in March, domestic cable companies have opposed the move, fearing a technology leak.
"There is no Chinese cable maker that can produce 500-kilovolt extra-high voltage cables. If Taihan is sold to a Chinese company, it is crystal clear that the firm will take advantage of Taihan's technology," an official in the industry said.
"Also, there is a concern that the ecosystem of the entire cable industry here would be collapsed. If Taihan is purchased by a Chinese firm, the new owner will produce cheaper extra-voltage cable using its cheap labor. It will eventually sell the cables on the Korean market and this will kill the domestic cable industry," the official added.
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