HS Hyosung Advanced Materials has selected qualified candidates (shortlist) to acquire its tire steel cord institutional sector. The seller plans to choose a preferred negotiating partner within this year's first half after a due diligence process.
On 2nd, according to the investment banking (IB) industry, HS Hyosung Advanced Materials and the sale's lead manager Samjong KPMG selected four candidates for the acquisition of the steel cord institutional sector, including domestic private equity fund (PEF) operators STIC Investments and JKL Partners, foreign PEF operator Bain Capital, and a Chinese strategic investor (SI).
More than a dozen investors are reported to be participating in this acquisition process. Among them are sovereign wealth funds from the Middle East as well as several foreign SIs from Europe and China.
The estimated sale price for the steel cord institutional sector is in the mid-1 trillion won range. This figure is derived from multiplying the EBITDA (earnings before interest, taxes, depreciation, and amortization) of 140 billion won by approximately 10.
Tire steel cord is a key material in tire manufacturing, playing a role in supporting the weight of the vehicle body. HS Hyosung's steel cord business, which holds a 1st market share in North America and 3rd in Europe, is evaluated to have significant growth potential due to the expansion of electric vehicle adoption. This is because the demand for high-strength tires that can support the weight of electric vehicle batteries is increasing.