SOUTH KOREA – KG Group, a local conglomerate in South Africa, has acquired 93.8 percent stake of Korean coffee franchise Hollys Coffee from IMM Private Equity for US$124 million.
Hollys Coffee is a specialty coffee company headquartered in South Korea. The company was established in 1998 and opened Korea’s first espresso shop that year. Its shops offer espresso, coffee, tea, specialty coffee- and tea-based hot and cold drinks, a variety of pastries and other snacks and coffee supplies.
KG Group has added another brand to its food and beverage portfolio following KFC, which was acquired three years ago.
The latest exit would bring IMM PE more than 200 billion won in its ammunition, which includes the proceeds from the sale estimated at near 200 billion won, previous dividend payouts and recapitalization at Hollys Coffee, Korea’s first espresso coffee chain.
The transaction markS IMM’s exit from the Korean investment in seven years since it acquired the coffee chain in 2013. It had injected lots of billions into Hollys for the acquisition and rights offering and already recovered the investment through dividend incomes and refinancing.
Since the IMM acquisition, Hollys has increased the number of its outlets to 560 nationwide from 384 in 2013. Revenues have more than doubled last year, versus in 2013.
IMM Private Equity is an independent private equity firm specializing in significant minority investment and middle market buyout.
For the past 10 years, IMM PE has logged an unblemished record of outstanding growth and returns and maintained its position at the top of Korea’s private equity industry.
KG Group has grown itself into a large business group through aggressive business acquisitions. KG Group’s acquisition of Dongbu Steel last year was a tipping point in its journey towards a business empire subject to strict public disclosure.
As of end-May, KG Group is Korea’s 63rd largest business group, according to the Korea Fair Trade Commission
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