China Minsheng Investment to invest in SK Planet

China Minsheng Investment Group, China's largest private-sector investment firm, is mulling an investment of 1.3 trillion won (US$1.13 billion) in Korea's SK Planet, the operating company of online shopping mall "11st." SK Planet, a 100-percent subsidiary of SK Telecom, has sought since early this year investment of 1 trillion won as a way to expand its shopping mall operation in response to aggressive moves by social commerce retailers like Coupang and TicketMonster.

According to investment banking sources on June 21, SK Planet has enlisted China Minsheng Investment as an investor and is currently in talks to determine the level of equity stake. Since early this year, the company has sought potential investors with Bank of America Merrill Lynch as an advisory firm. Although other financial investors such as IMM Private Equity submitted letters of intent, the terms fell short of SK Planet's expectations.

Meanwhile, China Minsheng with which SK Group's chairman Chey Tae-won has had direct contact for negotiations offered a satisfactory level of corporate value. An investment banker commented on the deal, "Even though value is important, it seems China Minsheng's offer as a strategic investor rather than a passive financial investor was received well by the SK chairman."

China Minsheng Investment Group, established in 2014 by Dong Wenbiao, former president of China Minsheng Bank, the nation's first private-sector bank, has a paid-in capital of 50 billion yuan ($7.6 billion). Mr. Dong is well connected politically as well as business-wise, serving as a member of Chinese People's Political Consultative Conference for two terms.

By Chang Jae Yoo
yoocool@hankyung.com