Hahn & Co. completes SKC's industrial film unit takeover for $1.2 bn

South Korean private equity firm Hahn & Co. has completed a 1.6 trillion won ($1.2 billion) deal to wholly acquire the industrial film business of SKC Ltd., a chemical material unit of the country’s second-largest conglomerate SK Group. 

Despite recent global interest rate hikes, Hahn & Co. has executed the acquisition financing in the low 7% interest rate range, the PE firm said on Dec. 2.

Hahn & Co. signed a sales purchase agreement with SKC in June. The divestment of the SKC unit, which makes polyethylene terephthalate (PET) films, was understood to be part of SK Group’s shift toward eco-friendly businesses such as electric vehicle batteries, battery materials and hydrogen production. 

Established in 1977, the unit has grown as the world’s fourth-largest industrial film manufacturer with 1.13 trillion won in revenue and 68.9 billion won in operating profit last year. Its films are used for mobile devices' displays and semiconductors as well as for industrial use.

Hahn & Co. said it expects demand for film materials in tech devices and automobiles to increase and aims to raise SKC's global market share.

The PE firm has completed some major deals amid COVID-19. In 2020, it acquired Korean Air Lines Co.'s in-flight duty-free and meal service units for 990.6 trillion won and branded it as Korean Air Catering & Duty-free.

In the same year, the PE firm bought SK Chemicals Corp.’s biofuel division for 382.5 billion won and rebranded it as SK Eco Prime Co., which focuses on eco-friendly fuels such as biodiesel and bio-heavy oil. In October, the PE firm said it is set to sell a 100% stake in SK Eco Prime.

In July this year, Hahn & Co. completed a $1.5 billion transaction via its continuation fund to maintain a controlling stake in local cement and concrete maker Ssangyong C&E Co. It was the largest continuation fund deal led by an Asian general partner.

UK-based secondaries investor Coller Capital was among the biggest limited partners of the fund, while Hahn & Co. committed a significant amount of capital and deployed funds in Ssangyong C&E for the third time. 

Write to Jun-Ho Cha at chacha@hankyung.com
Jihyun Kim edited this article.