이 기사는 2021년 07월 15일 07:52 thebell 에 표출된 기사입니다.

Market insiders are paying attention to whether Hankook & Company Group, formerly Hankook Tire Group, will make a foray into a venture capital business after the group recently established a new entity led by Cho Hyun-sik, vice chairman of Hankook & Company.

Hankook & Company established MW & Company at the end of last month, industry sources said Tuesday. Cho is the only outside director of the new company.

MW & Company states business purposes as investment and financing for new tech-backed companies, management and technical guidance for new tech-backed companies, formation of venture funds, business execution, management and operation of funds.

The purposes are similar to functions of existing venture capital firms which invest or provide loans to small- and medium-sized enterprises (SMEs) whose growth model is new technology development or businesses that are commercializing such technology.

MW & Company apparently intends to position itself as a venture capital firm for new tech businesses so that it has greater investment autonomy than ordinary venture capital firms for SMEs.

Venture capital firms for new tech operators do not have restrictions on their investment obligations under the Venture Investment Promotion Act. Once the firm is registered with the financial authorities, it may form or invest and manage a new tech fund without additional procedures.

MW & Company has capital of 100 million won ($86,910). As the minimum capital requirement for registration as the finance company for new tech businsses is 10 billion won, the firm is expected to increase its capital in the near term and start a process to receive approval from the financial authorities.

Hankook & Company is highly likely to the one involving in the capital increase process. The amended Fair Trade Act requires a holding company to own 100% of a corporate venture capital (CVC).

Cho may invest the entire 10 billion won in the company instead of raising funds from Hankook & Company amid an extensive proxy war with younger brother Cho Hyun-bum, president of Hankook & Company, over management control.

It seems that Cho Hyun-sik is taking the lead in advancing into the new technology finance business. Cho has emphasized the need to focus on investment and M&As to strengthen the company’s core business.

Hankook & Company Group has actively expanded its business into new fields beyond its mainstay tire manufacturing. The company acquired Model Solution in 2018 to make a foray into the software area and nimbly respond to market conditions in the future.

An official at Hankook & Company Group said the company doesn’t know about the establishment of MW & Company. (Reporting by Yong-bi Yang)