KKR to sell Korean battery components maker for $1b

KCF was one of two divisions carved out from LS Group less than two years ago at a combined valuation of KRW1.1 trillion. KKR took full ownership of KCF, which produces copper foils and flexible copper clad laminates primarily used in lithium-ion batteries. The plan was to build the business into a leading supplier for the electric vehicle industry.

The other division, which remains in the KKR portfolio, is LS Automotive (LSA), a components manufacturer specializing in human machine interface (HMI) components such as switches, displays, and lights. The business became available when LS Mtron – a division of the LS Group – decided to focus on its core tractor manufacturing business and sell LSA. It was structured as a joint venture, with LS Group holding 53% and KKR 47%.

While LSA is an established business, with a nearly 50% market share among Korean automobile manufacturers at the time of sale, KCF was viewed as more of an expansion play. In addition to helping the business transition into an independent entity – which involved rebranding, management team support, and securing long-term supply contracts – KKR claims to have doubled capacity and made inroads into key overseas markets.

“We are proud to have worked with the management team and employees of KCF to meaningfully grow the business and solidify the company’s technological leadership over the past several years,” said Chung Ho Park and Hyoung Seok Lim, both Korea-based managing directors with KKR, in a joint statement. They added that partnering with SK Group would put the company in a strong position.

KKR closed its third pan-regional fund at $9.3 billion in mid-2017. Auto components feature prominently in recent deal flow, with the firm securing a $4.5 billion acquisition of Japan’s Calsonic Kansei Corporation earlier the same year. In 2018, Calsonic bought Magneti Marelli from Fiat Chrysler Automobiles for EUR6.2 billion ($7.1 billion), creating the world’s seventh largest global independent automotive components supplier.

• Tweet  
• Facebook  
• LinkedIn  
• Google plus  
• Save this article  
• Send to  

• Topics
• North Asia
• Trade sale
• Industrials
• South Korea
• manufacturing
• KKR
• automobiles