Hyundai Home Shopping to divest rental unit for $107 mn

Hyundai Home Shopping Network Corp., a TV shopping channel operator owned by South Korea's Hyundai Department Store Group, said on Dec. 26 it will sell an 80% stake in Hyundai Rental Care Co. for 137 billion won ($107.3 million) to a Seoul-based boutique private equity firm. 

The TV shopping channel operator said it has decided to divest the rental unit’s majority equity and management rights to quickly respond to changes in business environments and rebalance its investment portfolio.

The local PE firm is planning to complete the transaction via a fund with commitment from M Capital and other investors by the next month. M Capital, formerly a credit investment unit under chemical and construction conglomerate Hyosung Corp., was acquired by a consortium of STLeaders Private Equity and the Korean Federation of Community Credit Cooperatives (KFCC) in December 2020.

Hyundai Home Shopping will hold the remaining 20% stake. 

The TV shopping channel operator set up Hyundai Rental, the unit that leases water purifiers, air cleaners, bidets, refrigerators and other home appliances, in 2015 holding 100% equity. 

The rental company posted operating losses every year since its inception until 2021. With 7.4 billion won of cumulative profit until the third quarter, the company is expected to be in the black for the first time this year.

The new owner of Hyundai Rental will continue the current employment contracts after the acquisition.

Write to Mi-Kyoung Lee at capital@hankyung.com
Jihyun Kim edited this article.