Daewoo E&C jointly creates $400 mn fund for overseas M&As

Daewoo Engineering & Construction Co. of South Korea and IMM Investment Global, the Hong Kong-based affiliate of Korean equity firm IMM Investment Corp., have jointly created a corporate partnership, or COPA, fund. COPA funds are private equity funds for overseas M&As, with capital commitments from pension funds targeting stable profitability.

Daewoo E&C and IMM Investment Global will each commit $200 million to create a $400 million fund, the construction giant said on March 28. They aim for co-investments in cold chain logistics, environmental, social, and governance plays and blue-chip infrastructure companies overseas.

Daewoo E&C will particularly focus on Vietnam-based cold chain logistics as its new core business. The firm is planning to build on its industry value-chain capabilities in Vietnam, including land development, construction and management.

“We are accelerating to find new business areas and technologies that align with the paradigm shift, such as the fourth industrial revolution, ESG management and carbon neutrality. Also, based on our recent takeover by the Jungheung Group, we will strengthen strategic investment for further growth,” a Daewoo E&C official said. Jungheung completed its merger with Daewoo E&C in late February, acquiring 50.75% of the company for 2.1 trillion won ($1.7 billion).

The construction company entered the Vietnamese market in 1991 with its Hanoi branch foundation. Since then, it has participated in a number of projects with a combined worth of $3 billion. In January, a Daewoo E&C-led consortium signed a contract to develop the H1HH1 block in Starlake, a new urban town in northwestern Hanoi. The entire project will cost $185.5 million including constructing and operating the building complex. 

IMM Investment is managing 6.4 trillion won in assets, focusing on venture capital, mezzanine and infrastructure. It has proactively invested in Vietnam -- the PE firm invested $470 million in food conglomerate Masan Group Corp. in 2018 with Korea's National Pension Service and SK Group. In 2019, it invested $300 million in tech & industry giant Vingroup JSC Company with SK Group.

Write to Sang-Mi An at saramin@hankyung.com
Jihyun Kim edited this article.