EQT, the largest private equity firm in Europe, is setting sights on healthcare, technology companies and business service providers in South Korea. The Swedish investment firm is also looking to companies with room to grow through digitalization, or by enhancing management efficiency, said Jean Eric Salata, chairman of EQT Asia.
This year, he expects South Korea’s M&A market to create various opportunities for private equity investment as the country’s leading conglomerates are working to shed non-core assets to survive a sputtering economy and a slowdown in the electric vehicle industry.
“We have about 40 investments that we’re actively reviewing right now,” Salata told The Korea Economic Daily in an interview this week. “Of course, very few of them end up getting closed at the end of the day, but we have a big pipeline.”
LONG-TERM APPROACH
EQT, under the umbrella of Europe’s powerful Wallenberg family, takes a long-term perspective — typically a five-to-seven-year horizon. So it does not hesitate to pay a high entry price for companies with a grow potential, said its Asia head.
In 2023, it acquired SK Shieldus Co., a Korean security service provider, for more than 2 trillion won ($1.4 billion).
Last year, EQT purchased KJ Environment and affiliated companies for around 1 trillion won, an investment aimed at establishing a waste treatment platform in South Korea. The same year, the investment firm also took over SecuLayer Co., a Korean cybersecurity company as a bolt-on investment for SK Shiedus.
The Scandinavian investment firm is zooming in on companies in areas such as cloud computing, artificial intelligence, electric vehicles and renewable energy.
Among healthcare companies, EQT is interested in Korean medical aesthetic device makers for skincare, citing their advanced technology and strong global growth potential.
For traditional businesses, it is eyeing companies that are gaining market share from rivals, Salata added.
EQT focuses on improving sustainability and digitalization, along with aligning its interests with the companies it invested in.
“We believe in digitally transforming companies as a way of creating value. We have a whole digital business development team internally that helps companies digitalize,” said the veteran Chilean investor based in Hong Kong.
It also employs thematic investment strategy, targeting companies with weak governance and management. It aims to help them focus on core businesses and increase spending on technology as well.
“There are still a lot of inefficiency … Efficiency gains and improving businesses is one opportunity,” he noted.
In 2024, it executed about 22 billion euros ($21 billion) worth of private equity investments globally. That represented a 27% increase from 2023.
In terms of assets under management, EQT is the world’s third-largest private equity firm. It manages 246 billion euros in assets via 48 vehicles as of September last year.
By Da Eun Choi and Kyung-Mok Noh
max@hankyung.com
Yeonhee Kim edited this article.
