이 기사는 2021년 04월 30일 07시56분 thebell에 표출된 기사입니다

Seoul-based IMM Private Equity will acquire a 40% stake in South Korea’s lube base oil supplier SK Lubricants for 1.1 trillion won ($993 million), thanks to its flexible exit strategy.

There was reportedly little difference in bid prices among bidders including Korea Investment Partners, Apollo Global Management and Japan’s biggest refiner ENOES. IMM PE won the bid by offering better terms, including non-price factors, industry sources said.

The latest investment was conducted under the condition of SK Lubricants' initial public offering (IPO). Given that the deal includes a minority stake in the company, most of the bidders stated drag-along rights as a tool for protection in case their exits become difficult in the future.

IMM PE was the only candidate that didn’t include a drag-along clause in its terms and conditions. The PE firm has experienced from its previous investments that it is not easy for a minority shareholder to exercise drag-along right against conglomerates. It was also burdensome for seller SK Innovation to guarantee drag-along rights that could threaten its management rights.

Instead, IMM PE came up with an exit strategy that retrieves its invested capital through dividends, considering SK Lubricant’s strong cash-generating capability. The PE firm chose downside protection that could generate a certain amount of profit even if SK Lubricants fails to go public.

For IMM PE, the latest deal marks its first investment from its private credit arm, IMM Credit Solution, launched in the second half of 2020. The PE firm plans to finance half of the total investment through its project fund, with the rest coming from acquisition loans, which will be provided by Shinhan Bank and Hana Financial Investment.

The proceeds from the stake sale will be used to finance SK Lubricants’ electric vehicle battery plants in the U.S. (Reporting by Si-eun Park)