Premier Partners and Praxis Capital are on course to raise 1 trillion won ($680 million) in their respective funds after the two South Korean private equity firms swept the beauty contests to attract major Korean pension funds in 2024.
The two investment firms each manage about $1 billion in assets and focus on growth capital strategies. With strong track records, they outmaneuvered MBK Partners, with $30 billion in assets under management, in multiple competitions to win over leading Korean asset owners.
Eleven major institutional investors in South Korea committed a total of 2.79 trillion won ($1.9 billion) to large and medium-sized private equity funds in 2024, excluding credit and small-cap strategies funds.
They include the National Pension Service (NPS), Government Employees Pension Service (GEPS), Korea Scientists and Engineers Mutual-Aid Association (SEMA), Military Mutual Aid Association (MMAA), Korea Development Bank (KDB) and Export Import Bank of Korea (KEXIM).
MG Community Credit Cooperatives, Korea Post, KBIZ Korea Federation of SMEs, Pension Foundation of Presbyterian Church of Korea and the radioactive waste management fund under the Ministry of Trade, Industry and Energy also commiitted to those funds in 2024.
| Private equity firm’s name | Major Korean limited partners in 2024 | Target fund size |
| Premier Partners | NPS, KDB, KEXIM, SEMA and four others | More than 1 trillion won |
| Praxis Capital | NPS, GEPS, MG Community, MMAA and three others | 800 billion-1 trillion won |
| JKL Partners | NPS, KDB, MG Community and KBIZ | 800 billion won |
| MBK Partners | NPS, GEPS, Radioactive Waste Management Fund | $7 billion |
| (Source: Premier Partners, Praxis Capital, JKL Partners and MBK Partners) | ||
Premier Partners, specializing in venture capital and growth capital, reaped juicy returns from minority stake investments in SK IE Technology Co. (SKIET) and three-dimensional dental scanner maker Medit Corp.
Praxis Capital Partners, established in 2013, logged an internal rate of return of 26% from the sale of BusinessOn Communication Co., a digital tax invoice provider, to SkyLake Equity Partners.
Praxis focuses on middle-market buyouts and growth capital investments in Korea.
It notched up a handsome return from Doosan Robotics Inc., a collaborative robot manufacturer, equivalent to 6.5 times its investment in just two years.
JKL Partners also stood out among Korean PE firms. After receiving commitments from the NPS and KDB as well, it is seeking to raise about 800 billion won in a mid-cap strategy fund.
MBK PARTNERS
North Asia-focused MBK Partners got off to a good start in 2024 with a new funding from the NPS.
But it failed to draw new commitments from other major Korean limited partners after announcing a hostile takeover bid for Korea Zinc Inc.
However, it is poised to take control of the world’s No. 1 zinc smelter, which would mark the first unfriendly acquisition of a domestic company.
In November, MBK said it has raised $5 billion at the second close of its new buyout fund that targets $7 billion at the final close.
Armed with new money, the three Seoul-based PE firms and MBK are expected to lead South Korea’s M&A market in the next couple of years as buyout firms tend to deploy 70-80% of their funds within the first two to three years after fundraising.
By comparison, VIG Partners, a first-generation homegrown PE house in South Korea, lagged behind local peers in the fundraising race. It failed to win an NPS mandate for the second straight year in 2024.
Centroid Investment Partners and E&F Private Equity also performed poorly in 2024 fundraising.
Write to Jong-Kwan Park and Ji-Eun Ha at [email protected]
Yeonhee Kim edited this article.
