SK Networks sees $80 mn valuation gain from Kurly

South Korea's grocery delivery app Kurly Inc. has generated a valuation gain of 100 billion won ($80 million) for SK Networks Co., or a triple-digit paper return for its investment of 23.4 billion won ($19 million) in the startup.

As an early stage investor, SK Networks accumulated 1.24 million shares in Market Kurly's operator for 23.4 billion won between 2018 and 2021, according to its regulatory filings as of April 25.

SK Networks, a general trading firm, injected 8.1 billion won into the unicorn startup in 2018; an additional 7 billion in 2020; and another 8.3 billion in 2021. 

Based on the total purchase price, the SK Group arm paid an average of 18,832 won per share for the food delivery service.

In January of this year, its valuation soared by 431% to 100,000 won per share, at which Hong Kong-based Anchor Equity Partners invested in the app. 

Based on the latest valuation, SK Networks’ stake in Kurly is estimated at 124.4 billion won.

Kurly’s IPO, due later this year, should help SK realize its investment gains and could increase its returns with a higher valuation in the IPO process.

On March 28, Kurly applied for the preliminary screening to list on the Kospi main exchange, aiming to raise around 1 trillion won ($815 million).

Kurly is poised to become the country's first e-commerce platform to go public this year.

In 2021, its revenue jumped 63.8% on-year to 1.6 trillion won, while its operating losses nearly doubled to 217.7 billion won.

SK Networks has been pursuing investment targets both at home and abroad.

Last year, it injected $25 million into Standard Cognition, a US autonomous checkout tool and put 12 billion won into Korean payment tech startup CHAI.

Earlier this year, SK Networks invested $20 million in California-based biotech startup MycoWorks and joined $15 million in funding for US healthcare startup LVIS Corp.

In terms of exits, it divested of a 4% stake in Mesh Korea, the operator of the last-mile delivery app Vroong, late last year. Its 10-billion-won investment in Mesh in 2018 yielded a 50% return in three and a half years.

SK Networks is now on the hunt for a strategic acquisition target worth over 1 trillion won to accelerate its shift away from trading and rental services. 

Write to Ik-Hwan Kim at lovepen@hankyung.com
Yeonhee Kim edited this article.