Woongjin buys back Coway water and air purifier brand

By Lim Chang-won Posted : October 29, 2018, 10:03 Updated : October 29, 2018, 17:26

[Courtesy of Woongjin]


SEOUL -- South Korea’s second-tier conglomerate Woongjin Group will buy back Coway Co., a water and air purifier maker which was sold to a local investment firm five years ago when the group was reeling from financial woes caused by rapid business expansion.
 
Woongjin ThinkBig, the group's education service unit, said in a regulatory filing Monday that it would buy a 22.17 percent stake in Coway for 1.685 trillion won ($1.478 billion). The acquisition will be completed on March 15 next year.
 
Coway, which used to be Woongjin's flagship business, produces and rents home appliances such as water filtration appliances, air purifiers, bidets and water softeners. MBK Partners, a Seoul-based private equity firm, bought a 26.8 percent stake in Coway for about 1.2 trillion won in 2013.

Woongjin has set up a consortium with STIC Investments, a private equity fund, to buy back Coway, which still maintains its brand recognition among South Korean consumers as the country's first water purifier maker.

Coway shares fell sharply as investors remained concerned about Woong's financial status. However, group officials said there is no uncertainty in funding as the group would inject more money into Coway by selling non-core assets. Woongjin will chip in 400 billion and STIC Investment 500 billion won respectively with the remainder to be financed through bank loans.

Woongjin Group chairman Yoon Seok-keum promised to nurture Coway as the backbone of his group, admitting "greed" had caused the group's financial pinch. "I think it was a good lesson for businessmen, and I will do my best to grow one industry more robustly with no vanity," he told reporters, adding the rental business has great potential for growth.

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