On the afternoon of Tuesday, November 2, a mixture of around 250 overseas and domestic investors and advisers gathered at the Grand InterContinental Hotel in Seoul for Invest KOREA’s inaugural Private Equity & Venture Capital Forum.
Organized as part of Foreign Investment Week 2010, the forum was supported by the UN’s Principles of Responsible Investment (PRI) initiative, and by media partner Dow Jones Private Markets.
Starting slightly after the scheduled start time of 1.30pm, as additional seating was hastily added, the commissioner of Invest Korea, Mr. Hank Ahn provided the welcoming remarks.
Shortly after, Mr. Soomin Kim of Bain & Co.’s Private Equity Team delivered a presentation on the evolution of Korea’s M&A market, including an interesting look at how the Asian Financial Crisis affected Korea’s buyout market. After his presentation Mr. Kim, moderated a panel discussion on the Future M&A Trends & Deal Opportunities, which featured Mr. James Yoon, founder of MBK Partners, Mr. Jason Shin, founder of Vogo Capital, and Mr. ByungMoo Park an attorney at Kim & Chang law firm. Panelists discussed the local buyout industry and its attractiveness as compared to other markets in Asia.
Soomin Kim - Bain & Co.
James Yoon said though the industry had proven highly cyclical, Korea represented a realm of largely untapped opportunity given the ongoing overhaul of the banking sector and “severe allocation imbalance” among foreign investors in favor of larger, Asian markets such as China and India. It seemed unfair, he added, that the many successful exits foreign companies had effected from private equity investments in Korea continued to be “overshadowed” by US fund Lone Star’s high-profile struggle to extricate itself from its purchase of Korea Exchange Bank.
A similar note was struck by Jason Shin, managing partner at Vogo Fund, who said Korea was “full of potential” for private equity funds, with relatively reasonable prices and an abundance of conglomerates poised to spin off non-core assets.
Delegates saw particular potential in the venture capital and green technology arenas. LB Investment CEO Brian Koo in his presentation pointed out Korea ranked number three in the venture capital market globally and the country’s small and medium sized enterprises produced well over 200 products that placed from first to fifth in terms of global market share.
Representing the UN PRI were two presenters, firstly Ms. Louise Davidson of Australian superannuation fund Cbus, gave a general overview of the UN’s work in private equity, and the importance of incorporating environmental, social, and governance (ESG) factors. Following this, Mr. David Russell of the UK’s Universtities Superanutaion Scheme (USS), and a PRI board member, provided a case study on why and how his firm integrates responsible investment into their investment decisions.
The first session after the networking break was on Korean LPs investment strategy, asset allocation, and GP selection criteria. Moderated by Mr. Yong-Nam Jun of Kirkland & Ellis LLP, this panel included Korea’s three largest government LPs, including Mr. In-Kyu Song, Head of research and asset allocation at Korea Post, Mr. Sang-Hyon Ryu, head of valuation, alternative asset division, National Pension Service, and Mr. Brian Choi, head of real estate, private markets group, Korea Investment Corporation. The discussion can be viewed online here.
Following this panel, were two investment case studies – firstly Mr. Michael Paik of clean tech specialist fund, Samho Green Investment, presented on the attractiveness of Korean clean tech companies, and the government support. This was followed by Mr. Eric Kim of Macquarie Opportunities Korea Fund, with a look at the opportunities for infrastructure investors.
Alexander Haislip - Financial Journalist & Author
The final session of the day was the Global LP panel, moderated by the entertaining Alexander Haislip, financial journalist and author of ‘Essentials of Venture Capital’ (Wiley 2010), with panelists including Mr. Andrew Musters, head of global private equity at Robeco, Dr. Alexander Blank, Vice president at SCM Strategic Capital Management, Chris Yang, general partner, Grove Street Advisors, and Hans-Martin Aerts, head of infrastructure, APG Asset Management Asia.
This final panel discussion was a highlight for the 150 or so attendees who remained, as for the first time in the day they heard about Korea’s investment environment from an outsider’s point of view. Moderator Mr. Haislip not pulling any punches in his questions was rewarded by frank responses from the panel, with discussions carrying on after the end of the panel and into the cocktail reception.
1:1 IR Meetings on Day 2
Day two of the event involved 1:1 meetings between foreign investors and Korean investors and investment-seeking companies. Throughout the day over 300 meetings were arranged as participants discussed investment and co-investment opportunities in Korea.
View the brochure for the Korea Private Equity & Venture Capital here or click here to see all the presentation videos.
For more information about the presentations, presenters, attendees, or future events please contact the Finance Industry Investment Promotion Team at investment@kotra.or.kr or on +82-2-3460-7536.
Story by Brett Moffat, additional reporting by Jonathan Hopfner.
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