Yi Whan-woo is a Korea Times journalist primarily covering finance. He writes in-depth articles on macroeconomy and financial markets and previously covered sports, politics, diplomacy and inter-Korean affairs, among others. Feel free to contact him at yistory@koreatimes.co.kr.
Private equity firms expand presence as controlling shareholders of listed companies
A screen on the ceiling shows real-time stock data at a dealing room in Hana Bank's headquarters in central Seoul, Wednesday. Yonhap
By Yi Whan-woo
Private equity (PE) firms are expanding their presence as controlling stakeholders of listed companies in Korea, in line with the rapid growth of the PE market, data showed Wednesday.
The data released by corporate tracker CEO Score showed a total of 58 PE firms were the largest shareholders of the country’s publicly traded companies as of August this year. The figure more than doubled from the end of 2014 at 21, according to the data.
The data came as the net assets of the PE funds surged from 111 trillion won in 2011 to 635 trillion won ($477.65 billion) as of April this year.
The 635 trillion won accounted for almost two-thirds of the entire fund market that surpassed the 1,000 trillion won mark in 2023.
“The PE firms are increasingly emerging as largest shareholders of listed companies,” CEO Score said.
It added, “Their emergence is beginning to reshape the governance structure of listed companies, and PE firms are expected to have greater influence.”
Among the 58 companies in August were IMM PE, Hahn & Company and JKL Partners.
IMM PE has been the largest shareholder of Hanssem, a top-ranked furniture brand listed on the benchmark KOSPI, after Hanssem founder Cho Chang-gul sold a 27.7 percent ownership stake in the company to SPC Haim in 2022.
SPC Haim was formed for IMM PE’s investment in Hanssem.
Hahn & Company took over KOSPI-listed Namyang Dairy Products in January this year when it acquired a 52.63 percent stake in the dairy manufacturer previously managed by the second generation of the founding family.
JKL Partners has been the largest shareholder of Lotte Insurance after acquiring a 77.04 percent stake in the KOSPI-listed non-life insurer.
Meanwhile, CEO Score data showed that more than half of the controlling stakeholders at listed companies were their founders.
It said 1,446 firms or 55.7 percent of the 2,597 companies on the KOSPI plus two smaller bourses, the Kosdaq and KONEX, had their founder as the largest shareholder.
The 55.7 percent was up from 10 years earlier when the rate was 52.5 percent.
“It can be said the first generational members of the company’s founding families are still actively engaged in management,” CEO Score said, noting many of the listed firms are family-owned businesses.
The percentage of companies with second-generation members of founding families as the controlling stakeholders went down by 5 percentage points to 25.6 percent over the 10-year period.