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PEF to buy IS Dongseo ceramics operation for W217b

IS Dongseo's Inus brand products
IS Dongseo's Inus brand products
E&F Private Equity has inked a deal to acquire the ceramics operation of concrete-to-construction business group IS Dongseo for 217 billion won ($178 million), according to a filing on Wednesday.

The private equity firm, managing 342.2 billion won in assets as of 2019, agreed to buy a 100 percent stake in the operation on May 15. Prior to the transaction, the ceramics business will be split off from IS Dongseo earlier in May, which will be named Inus.

The business, dedicated to making and selling toilet bowls, bidets, wall tiles and floor tiles under the Inus brand, generated revenue of 181.8 billion won in 2019, down 12.3 percent on-year. Its operating profit has been on the decline, recording a deficit of 2.1 billion won as of end-September, a turnaround from 5.7 billion won profit in 2018.

IS Dongseo said the deal is meant to focus on its core business. As of end-September, IS Dongseo earned about 60 percent of its revenue from the concrete and construction business, while its key apartment-building unit is expected to see a sharp decline in earnings.

The announcement comes three months after IS Dongseo, a company listed on the main bourse Kospi, sold its key equipment rental unit Korea Rental to Dream Security and private equity firm PS Alliance for 75.7 billion won in cash.

Founded in 2014, E&F Private Equity has focused on buyout strategies in Korea’s environmental sector. It holds stake in 16 portfolio firms through seven vehicles. The deal marks E&F PE's first to be signed this year. The PEF also awaits the signing of Kolon Environment & Energy acquisition for roughly 50 billion won.

By Son Ji-hyoung (consnow@heraldcorp.com)
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