Green Exit: Buyout giant KKR, Taeyoung to sell South Korea’s JV Ecorbit in over $2 billion deal

KKR & Co, a global buyout firm, and South Korea’s Taeyoung Group are planning to sell their joint venture Ecorbit in a deal that may value the environmental company at over $2 billion, Reuters reported, citing two individuals familiar with the deal.

Representatives from KKR, Citigroup, and UBS declined to provide comments. Taeyoung Group and Ecorbit were unavailable for immediate comment outside of regular business hours. The Korea Economic Daily initially reported the bank’s involvement on Tuesday.

According to Reuters’ report, Citigroup and UBS have been appointed to oversee the sale process, which is anticipated to commence in the next few months, although the sources requested anonymity due to the confidential nature of the information, Reuters

Ecorbit, formed in 2021 through the merger of KKR’s Eco Solutions Group and Taeyoung’s TSK Corp, specializes in water treatment, industrial and medical waste management, and material recycling, as stated on its website.

The decision to sell comes after Taeyoung Group’s affiliate, Taeyoung Engineering & Construction, announced plans in December to restructure its debt, which stands at 4.58 trillion won ($3.6 billion), including project financing loans.

The builder’s financial difficulties have prompted the South Korean government to pledge cooperation with the central bank to implement market-stabilizing measures if necessary.

One of the sources mentioned that although KKR is leading the sale, specific details of the plan are still being finalized, and Taeyoung E&C’s creditors are expected to convene in the following weeks

We wrote about KKR back in 2020 when the firm closed a $2.2 billion Next Generation Technology Growth Fund II for investment in tech startups across North America, Europe, and Israel.  The fund, called “NGT II” or the “Fund”, will be dedicated to growth equity investment opportunities in the technology space in North America, Europe, and Israel. NGT II is the successor fund to KKR Next Generation Technology Growth Fund (“NGT I”), KKR’s first dedicated global technology growth equity vehicle which completed fundraising in December 2016.

Henry Kravis founded KKR along with two other business partners in the late 1970s when he was just 32. The firm’s objective was to create and manage private equity funds that borrowed money to acquire businesses that were underperforming. Kravis and his partners later improved these businesses and sold them at a profit. As of March 31, 2020, the company had $207 billion in assets under management.