LX Hausys, formerly LG Hausys, which specializes in windows and interior materials, has entered the race to acquire South Korea’s top furniture maker Hanssem.
The company, which is part of LX Group – a new entity that was separated from LG Group earlier this year, is the latest to show interest in buying a controlling stake in the firm, following other retail giants including Lotte, according to multiple reports.
For its bid, LX Hausys will be joining a private equity fund set up by IMM Private Equity with 300 billion won ($255.4 million) of investment money.
Despite maintaining its top position in the domestic kitchen furniture market since 1986 and in the interior furniture market since 2001, Hanssem agreed to sell a controlling stake owned by its honorary chairman and those with a “special relationship” in July.
Industry experts have said the decision to sell the company comes with no heir to lead. The decision also comes after Hanssem posted 2.06 trillion won in revenue last year, up 21.7 percent from the previous year as the interior design and furniture market enjoyed a pandemic boost.
Following the news, both LX Hausys and Hanssem shares jumped 7.62 percent and 2.95 percent respectively as the market closed on Tuesday afternoon.
In a statement on Monday however, LX Hausys said the final decision has yet to be made and it is for IMM to choose their strategic investor.
“It is to strengthen our high value construction materials business and market presence and help develop the ‘total interior’ business as our growth engine, which is our mid-term strategy,” one official at LX Hausys said.
“Once LX Hausys becomes the strategic partner, we expect to create a mutual synergy between Hanssem’s wide range of furniture and items and LX Hausys’ premium construction materials in the domestic ‘total interior’ market, which will further solidify its market dominance.”
“Total interior” refers to a curated interior design service where items such as furniture, wallpaper and windows are all prepared by the company to make it easier for customers to design their home.
The remodeling industry and demand for high quality and premium services will continue to grow as the number of old homes increases, LX Hausys said.
By Yim Hyun-su (firstname.lastname@example.org