South Korea’s Hanwha Group is seeking to acquire a local catering service provider Ourhome, embroiled in sibling disputes, for about 860 billion won ($592.8 million) as the chemicals-to-defense conglomerate aims to restart the food business, investment banking industry sources said on Friday.
Hanwha Hotels & Resorts Co., the group’s hospitality unit, is in due diligence to buy a 57.84% stake in the country’s No. 2 catering company held by its founding family members, including 38.56% from an ex-CEO Koo Bon-sung and 19.28% from the current chief executive Koo Mi-hyun, according to the sources.
They plan to sign a stock purchase agreement early next year.
Ourhome’s corporate value was estimated to be around 1.5 trillion won, the sources said. The former and current CEOs were known to have lowered the value from 2 trillion won, which the siblings had estimated when they tried to sell their stakes two years ago, considering the current market evaluations, according to the sources.
Hanwha is considering forming a consortium with financial investors such as private equity firms to raise money for the acquisition, sources said.
TO RESUME CATERING BUSINESS
The group, which has been mulling the takeover since earlier this year, started talks for the deal in June when Koo Mi-hyun, the eldest daughter of the founding family and stay-at-home mother, took office.
The acquisition is expected to allow Hanwha Hotels & Resorts to resume the catering business, which the company has suspended. The business has been rapidly growing in South Korea although the local restaurant industry was hit by a slowdown in Asia’s fourth-largest economy.
Kim Dong-seon, Hanwha Hotels & Resorts vice president, was understood to have led the acquisition deal.
The third son of Hanwha Group Chairman Kim Seung-yeon has been seeking a takeover deal worth around 1 trillion won in the food and beverage sector.
PRE-EMPTION RIGHTS
Ourhome has been engulfed in a sibling feud, including a legal battle, since 2017 as the four children of the late Chairman Koo Ja-hak together hold more than a 98% stake in the unlisted company.
Koo Bon-sung is the brother and the oldest of the siblings. Koo Ji-eun, the youngest daughter who led the company from June 2021 to June 2024, holds 20.67%, while another daughter Koo Myung-jin has 19.6%. Koo Ji-eun failed to serve another term amid the intensifying feud with her brother and the current CEO.
Hanwha’s takeover attempt could hit a roadblock as those younger daughters have pre-emption rights, industry sources said.
Ourhome’s articles of incorporation require a shareholder to sell his or her stake to other existing shareholders first.
By Ji-Eun Ha
hazzys@hankyung.com
Jongwoo Cheon edited this article.
