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Distribution centers

Goldman-backed Korea Superfreeze to build $2.2 bn facilities

By Apr 26, 2021 (Gmt+09:00)

A warehouse of Korea Superfreeze
A warehouse of Korea Superfreeze

Korea Superfreeze Co., 24.95% owned by Goldman Sachs PIA, will spend 2.5 trillion won ($2.2 billion) in building six cold storage facilities in South Korea this year, part of which the private equity firm will finance, according to sources with knowledge of the matter on Apr. 26.

Its facility investment plan comes as Coupang Corp., the country's No.2 e-commerce platform is expected to invest around 4 trillion won in securing new distribution centers over the next five years following its $4.6 billion New York listing last month.

Founded by private equity firm EMP Belstar in 2015, Korea Superfreeze was the first company in the country to use cold energy extracted from liquefied natural gas (LNG) frozen at minus 162 degrees to refrigerate vast storage warehouses.

Korea Superfreeze will make additional investments in the trillion won range to boost its cold chain logistics network in the country. Down the road, it will list on the Korean stock market or in Singapore, after opening a Singapore office within the year. 

SK Inc. holds another 24.95% stake in the storage company as a joint second-largest shareholder with Goldman Sachs (GS) PIA, after they invested 25 billion won each in a special purpose company (SPC) that owns 100% of Korea Superfreeze in 2020. EMP Belstar is the top shareholder with a 50.1% stake.

This month, both GS PIA and SK Inc. injected an additional 12.5 billion won each into the SPC. They will fund the new six cold storage facility construction. 

Korea Superfreeze runs a ultra-low temperature warehouse in Pyeongtaek, measuring 148,000 square meters, in Gyeonggi Province. Coupang and Market Kurly, a premium food delivery app., are among the customers of the Pyeongtaek warehouse.

The new six warehouses to be constructed will be located in the Seoul metropolitan area, including two warehouses in Incheon, west of Seoul, for 500 billion won each. The state-run Korea Gas Corp. is said to invest in the two Incheon-based warehouses.

The cold storage facility operator has secured the land for the six new facilities which it expects to be used by food delivery service companies, including Samsung Welstory Inc. and Hyundai Green Food Co.

"Large food companies are struggling with the outdated and fragmented cold chain logistics system," said EMB Belstar Korea head Lee Joonho. "There are many fresh food companies who asked Korea Superfreeze just to build cold storage warehouses to use them."

Korea Superfreeze is the only company in the country with the technology and resources to handle the widespread storage of vaccines that need to be kept at 70 degrees Celsius below zero.

EMP Belstar had launched Korea Superfreeze on the prospect of explosive e-commerce growth, in the absence of no dominant cold storage warehouse company in the country. It is a rare business model in South Korea for a private equity firm to run a distribution center directly. The company has built the ultra-low temperature warehouse tailor-made for food delivery companies for lease.

"Given the rapid growth of logistics services, pumping multitrillion won into Korea Superfreeze alone will produce a robust return," EMP Belstar's Lee added.

Korea Superfreeze is headed by CEO Kim Jin-ha, an ex-managing director of Samsung SDS Co.'s smart logistics division.

EMB Belstar, founded in 2005, has bulked up its size following its heavy investment in US assets in the wake of the 2007-08 global financial crisis. Since its acquisition of the US energy infrastructure investment firm EMP, it has begun investing in South Korea. It now manages around 6 trillion won in assets.

"As incomes are going up, so will demand for food storage facilities, which should fuel growth in the cold chain logistics service. We will build a single logistics platform spanning South Korea to China to ASEAB," Lee noted. 

It will set up a branch in Singapore within the year.

Write to Han-Shin Park and Chae-Yeon Kim at

Yeonhee Kim edited this article.

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