Lee Min-hyung joined The Korea Times in 2014 and has worked as a journalist mainly in Korea’s finance, tech and automotive industry. He specializes in content creation, breaking news and in-depth analysis currently on transportation and mobility. You can reach him via mhlee@koreatimes.co.kr.
Shinhan to take over Doosan's venture capital arm
Shinhan Financial Group headquarters in Seoul
By Lee Min-hyung
By Lee Min-hyung
Shinhan Financial Group plans to take over Neoplux, a venture capital subsidiary of Doosan Group, with a view to strengthening its group-wide investment portfolio and finding more promising startups, the company said Wednesday.
The announcement came Monday, shortly after Shinhan was named a preferred bidder to acquire Neoplux. The financial holding firm and the venture capital firm are reported to have reached a deal valued at 70 billion won ($58.56 million). But neither of them confirmed details over the price, as nothing has been finalized.
The acquisition is expected to help Shinhan speed up its group-wide drive to foster financial startups, the company said.
“The primary role of venture capital firms is to find startups with huge growth potential, so we expect Neoplux to help Shinhan find new growth engines,” an official at Shinhan said.
This is the first time Shinhan has acquired a venture capital company, even though the financial holding company has been seeking for years to do so.
“It will take at least a few months for us to complete the deal with Neoplux, and we are going to conduct due diligence on the venture capital soon,” the official said.
Shinhan has investment-related arms ― such as Shinhan Investment ― but it does not have any subsidiaries focused on making initial-stage investments.
“Shinhan Financial Group and our affiliates are carrying out a number of projects on innovation of the financial industry, and we have know-how in helping develop some existing players. We expect the latest deal to generate more synergy by tightening our group-wide investment portfolio,” the Shinhan spokesman said.
Among the top-four financial holding firms here, Shinhan and Woori do not run their own venture capital subsidiaries.
KB Financial Group, the nation's largest financial holding firm by market capitalization, runs its venture capital arm KB Investment. Hana Financial Group also has a similar venture arm, Hana Ventures.
Doosan Group has recently put Neoplux, a non-mainstream affiliate of the group, up for sale, as part of its ongoing restructuring to salvage cash-strapped Doosan Heavy Industries & Construction. Doosan holds a 97 percent stake in Neoplux.
In 2019, Neoplux pushed for an initial public offering, but suspended the plan indefinitely.
The company generated 15.5 billion won in sales last year, but reported an operating loss of 6.4 billion won, turning to a deficit from the previous year. The firm reported an operating profit of 4 billion won in 2017, and 10.6 billion won in 2018.