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Korea's Private Equity Fund (PEF) and
Venture Capital Ecosystem
Emerging as an Attractive Investment Destination
Private equity fund (PEF) and venture capital (VC) creation and investment in Korea have reached record-breaking levels for several consecutive years. Despite the global economic slowdown in 2023, Korean PEF and venture investments remained highly active
(Source: Preqin).
Dramatic Growth of the Korean PEF MarketThe Korean PEF market continues to grow steadily. As of the end of 2023, total investments in PEFs reached KRW 136.4 trillion, representing an 8.9% increase from KRW 125.3 trillion in 2022
(Source: Financial Supervisory Service).
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Restructuring of Korean Conglomerates
The sale of non-core businesses by Korean conglomerates as part of business restructuring is a key driver of growth in the PEF market. PEFs are actively acquiring these non-core assets, adding value to them, and subsequently selling them at higher prices, contributing to the overall market expansion.
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Digital Transformation of
Korean CompaniesThe digital transformation of the Korean economy is progressing rapidly. In recent years, numerous e-commerce, software, and technology-based companies, including Coupang, Yanolja, and Douzone Bizon, have successfully raised funds from financial investors.
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PEF Legal System Reform
A newly reformed legal framework for the PEF industry took effect in October 2021. The revised regulations expand the range of permissible PEF investment strategies beyond traditional management participation, enhancing the flexibility and attractiveness of the market for investors.
Gahyun Kim
Service Industry Promotion Team
+82-2-3460-3284
gahyun.kim@kotra.or.kr
Investment Success Stories
DIG Airgas
DIG Airgas is Korea's leading industrial gas provider founded in 1979 and acquired by MBK Partners in 2017. In 2020, MBK Partners sold DIG Airgas, achieving a return of over 100% in less than three years. Macquarie Group of Australia acquired the company from MBK Partners for USD 2.2 billion, with participation from a number of global LP investors, including the Government of Singapore Investment Corporation (GIC) and the pension fund of Alberta, Canada.
Yanolja
Yanolja is a Korean travel platform founded in 2005 that has grown into the country's largest online travel platform in just over 18 years. In 2019, the company became a unicorn with USD 180 million in funding from Booking Holdings, a major US travel platform, and the Government of Singapore Investment Corporation (GIC). In 2021, it was listed as a decacorn with a USD 1.7 billion investment from Japan's Softbank. Yanolja plans to go public in the coming years.