Anchor Equity closes second Korea fund at $850m
Anchor Equity Partners has raised $850 million for its second South Korea-focused fund, less than two years after closing Fund I at $500 million.
The final close for Fund II took place in July, but this appears to be the first public confirmation. Anchor launched the vehicle in May with a target of $750 million and was able to complete the process swiftly due to strong demand from LPs, a source close to the GP told AVCJ.
The firm - set up in 2012 by three senior members from Goldman Sachs' principal investment team in Korea - targets buyout, growth capital and industry consolidation opportunities.
It is perhaps best known for teaming up with KKR earlier this year to buy a controlling stake in local mobile e-commerce company Ticket Monster from US-listed Groupon for $360 million. There were also several co-investors in the deal, including Canada Pension Plan Investment Board and Temasek Holdings-owned Pavilion Capital.
The bulk of Anchor's deals fall within a Korean middle market that other GPs say is delivering a rich supply of succession planning deals, divestments of non-core assets by local conglomerates, and transformation investments in companies that want to expand overseas.
AVCJ Research data show that the volume of deals executed in Korea below $500 million has grown from 142 in 2005 to 371 in 2014. The vast majority of these transactions have consistently been in the segment below $200 million. The total amount of money invested in the sub-$200 million segment has increased as well, from $3.7 billion in 2005 to $9.1 billion in 2014.
Anchor is not the only successful spin-out from a larger PE firm in Korea. Last December, Hahn & Co - which was founded by Scott Hahn, formerly of Morgan Stanley Private Equity Asia - closed its second fund at the hard cap of $1.2 billion. It also raised a separate $700 million co-investment pool to support the acquisition of Halla Visteon Climate Control Corporation.
In addition, Japan-based GP Unison Capital closed its first Korea-dedicated fund in May. The vehicle came in at approximately KRW300 billion ($280 million) with an anchor commitment from the National Pension Service of Korea (NPS). The other LPs are also Korean.
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