Kurly, Golfzon get preliminary nod for 2022 IPOs

Gourmet food delivery platform Kurly and Golfzon County have won preliminary approval for their initial public offerings set for this year.

The Korea Exchange on Monday gave the nod to their IPOs four to five months after they submitted the plans.

To qualify for an IPO, Kurly received agreements from its financial investors that they would not sell shares in the operator of Market Kurly at least for one and a half years.

Also, Kurly founder and CEO Sophie Kim pledged to secure friendly shareholders equivalent to at least 20% of outstanding shares to calm concerns about the lack of strategic investors.

Kim owns 5.75% of Kurly, a far lower stake than some of its financial investors. Sequoia Capital holds a 12.87% stake in the platform as the largest shareholder. Hillhouse Capital has 11.89%; DST Global has 10.17%; Aspex Management has 8.48%; and Euler Capital has 6.73%.

But its valuation remains the biggest issue. The platform was valued at 4 trillion won when it received 250 billion won ($190 million) in pre-IPO funding from Anchor Equity Partners in December of last year.

Despite the subdued investor sentiment, Kurly decided to proceed in its quest for a stock market debut to pave the way for its financial investors’ exit.

For now, its accumulated losses could weigh down its valuation. Kurly’s operating loss nearly doubled to 217.7 billion won in 2021 from the previous year, despite a 64% surge in sales during the period.

GOLFZON COUNTY

In stark contrast to Kurly, Golfzon has been growing rapidly in line with the booming golf market.

Last year, its operating profit spiked 141.7% on-year to 52.2 billion won, with sales up 34.5% to 191.8 billion won.

Golfzon operates 18 golf courses with a total of 387 holes across the country. Based on the estimated 5 billion won per hole, its enterprise value is likely to come to about 2 trillion won, below the market estimate of around 3 trillion won early this year.

But the figure is still higher than the 1 trillion won range estimated when it was established in 2018. In that year, it was spun off from Kosdaq-listed Golfzon Newdin Holdings Co.   

MBK Partners is the largest shareholder in Goflzone with a 54.8% stake, alongside 3.5% of the latter’s preferred shares.

MBK Partners, one of Asia’s largest private equity firms, acquired a 50% stake in Golfzon County for 114 billion won in 2018 and raised its investment to a total of 288 billion won by participating in four rounds of rights offerings afterward.

Golfzon’s holding company is the No. 2 shareholder with a 41.6% stake.

MBK is understood to have agreed to a mandatory holding period after reducing its stake in the golf course operator to around 30% in the IPO.

Both companies' public offerings will come after other IPO candidates canceled their stock market debuts.

Security service company SK Shieldus Co., homegrown app store operator One Store Co. and Hyundai Engineering were among those who dropped their IPO plans this year.

By contrast, Socar Inc., a car-sharing platform, went public this month after slashing its IPO price by around 20%. On Tuesday, its shares closed down 2.47% at 26,950 won, below its IPO price of 28,000 won.

Write to Seok-Cheol Choi at dolsoi@hankyung.com
Yeonhee Kim edited this article.