Glenwood to join GS' acquisition of S&I E&C

South Korea’s construction conglomerate GS Engineering & Construction Co. said on November 17 that it has selected Korean private equity firm Glenwood PE as a financial investor (FI) to acquire a 60% stake in S&I Construction and Engineering under S&I Corporation, a subsidiary of Korean conglomerate LG Group.

Out of the total 400 billion won ($338.9 million) acquisition, GS E&C will pay 300 billion won while Glenwood PE will pay the remaining 100 billion won. The two buyers plan to complete the deal, which is the first merger and acquisition case between GS and LG, by the end of 2022.

S&I E&C was founded in August of this year as a spinoff of S&I Corporation. The spinoff’s main business is building LG affiliates’ plants, research and development centers as well as office buildings in Korea and overseas.

With $1.8 billion assets under management, Glenwood PE is seen as specialized in carve-out, a partial divestiture of a business unit in which a parent company sells its subsidiary to outside investors. Glenwood’s latest carve-out was the acquisition of a 24% stake in CJ Olive Young, Korean conglomerate CJ Group’s health and beauty brand, for 400 billion won in December 2020. In addition, in March of the same year, the Korean PE acquired a 54% stake in global polyimide film producer PI Advanced Materials from SKC and Kolon Industries for 610 billion won.

The acquisition of S&I E&C will be the PE firm’s first investment through its private credit fund. The credit fund considers mezzanine, opportunistic, special situations, high-yield debt and senior loan investments. 

Write to Chae-Yeon Kim at why29@hankyung.com
Jihyun Kim edited this article.