Carlyle to take Yakjin Trading public: report

U.S.-based private equity fund Carlyle has reportedly failed to sell Korea’s garment original equipment manufacturer Yakjin Trading, and will move to take the company public instead, a local news report said.

“Caryle is considering other various options including initial public offering,” as all potential buyers withdrew from due diligence on Yakjin and walked away from the deal, Yonhap said, quoting an unidentified source.

The Carlyle Group’s associate vice president Tammy Li, reached by phone, declined to comment on the report.

Deal manager JP Morgan held a preliminary bidding in late January where local buyout firm Stic Investments and U.S. private equity Texas Pacific Group and other strategic investors showed interest, local news reports said.

However, the potential buyers started to tap the brakes on due diligence in February, seemingly dissatisfied with the company‘s growth potential or the seller’s asking price, they said.

In December 2013, Carlyle acquired 100 percent stake in Yakjin Traiding for 204.8 billion won ($177.5 million) through the $1.04 billion Asia growth capital fund Carlyle Asia Growth Partners IV.

Over the past two years, the Korean company’s EBITDA has risen about 30 percent.

With manufacturing facilities in Vietnam, Indonesia, China and Cambodia, Seoul-based Yakjin provides OEM clothing for global fashion brands such as GAP and Banana Republic.

Yakjin posted 433 billion won in sales and 31.7 billion won in operating profits in 2014.

By Kim Yoon-mi (yoonmi@heraldcorp.com)