
South Korea’s Cactus Privat Equity is set to acquire a stake in YM Tech Co., a Kosdaq-listed electric vehicle parts maker, at nearly 200 billion won ($139.5 million), betting on the long-term growth of the global EV market, investment banking industry sources said on Wednesday.
Cactus sought to buy a 47.95% stake in YM Tech, including 40.6% of its President and largest shareholder Kim Hong Gi and 7.35% of a vice president, according to the sources.
The private equity firm is poised to complete project funding for the deal as soon as next month and sign a stock purchase agreement.
YM Tech’s stock on Tuesday ended up 7.6% at 12,050 won after surging to 14,290 won, the highest level since August 2024.
The company’s market capitalization has been around 120 billion won for the last three months. Cactus is known to have agreed to pay a premium of 50% of the market capitalization, according to the sources.
EV RECOVERY
Cactus easily attracted investors as major limited partners highly valued YM Tech’s growth potential, the sources said.
YM Tech manufactures EV relays, essential parts of the clean car that sit between the battery and the inverter. The company also produces relays for other applications such as energy storage systems (ESS) and uninterruptible power supplies (UPS).
The EV relay sector, which has been under pressure from the prolonged weakness in the global EV market, is expected to regain growth momentum once the eco-friendly automobile industry recovers, according to the sources.
Cactus is predicted to seek synergy with KG Mobility Corp., a South Korean automaker specializing in sport utility vehicles, through the acquisition, the sources said.
The private equity firm joined hands with KG Group as a financial investor when the South Korean chemicals-to-steel conglomerate took over the maker of the Torress SUV in 2022.
By Da Eun Choi
max@hankyung.com
Jongwoo Cheon edited this article.