UNID, Stic Investment to submit joint bid for Tongyang Magic

[THE INVESTOR] Ahead of the final bidding for local home appliance vendor Tongyang Magic on Sept. 27, potential bidders are forming consortiums to have a better chance of winning the acquisition deal.

While industry experts expect large conglomerates’ affiliates such as SK Networks, CJ O Shopping and Hyundai Department Store which have funds to finance the bid will take advantageous positions, private equity firms are moving to form consortiums to defeat them. 

Two potential bidders -- local chemical manufacturer UNID and homegrown PEF Stic Investment -- who showed their interest by submitting letters of intent in August, have reportedly agreed to make a joint bid.

CVC Capital Partners is negotiating with other strategic investors to form an alliance. Car rental firm AJ Networks plans to join hands with IMM Private Equity.

The sale of Tongyang Magic, a deal estimated at some 500 billion won (US$448 million), has attracted offers from seven to eight firms and has been under due diligence process over the past month.

Shortlisted firms include CJ O Shopping, SK Networks, Hyundai Department Store Group, UNID and AJ Networks as well as some private equity firms such as CVC Capital Partners and Stic Investment.

By Park Han-na (hnpark@heraldcorp.com)