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This article was published on May 19, 2025, at 4:18 p.m. on the ChosunBiz MoneyMove site.

The Korea Asset Management Corporation (KAMCO) is selecting an external expert institution to review the feasibility of investing in the corporations restructuring fund. As the economic slowdown continues, an increasing number of limit corporations are going through corporate recovery and workout procedures, and it is analyzed that external advice is being sought due to the rising difficulty of post-restructuring investments compared to the past.

According to investment bank (IB) industry sources on the 19th, KAMCO is in the process of selecting an external expert institution for legal advice and financial advisory services, including the operation of the corporations restructuring fund master and sub-funds and investment feasibility reviews. The law firm Jiphyeon has submitted a bid alone as the legal advisory firm, while four firms, including Samjeong Accounting Corporation, Our Accounting Corporation, Samhwa Accounting Corporation, and Hanul Accounting Corporation, are known to have participated as financial advisors. Samjeong Accounting Corporation has been selected as the first priority.

The corporations restructuring fund is a policy fund launched in 2018 to focus restructuring previously conducted by national policy banks in the capital market. After receiving investments from the government and national policy banks, the master fund is created, and the private equity fund (PEF) operator selected as the management company then forms the sub-fund through private matching based on the master fund's investment. The first, second, and third funds are managed by Korea Growth Investment Corporation (K-Growth), while KAMCO has been managing the master fund from the fourth fund onward.

KAMCO plans to establish a total of 4 trillion won in corporations restructuring funds by 2027. For last year's launched fifth fund, if 500 billion won is invested from the master fund, the operators will form the sub-fund, thereby creating a total of 1 trillion won in restructuring funds. The structure allows for the creation of funds of about 1 trillion won each time an investment project is conducted, reaching the target amount after four investment rounds.

The reason KAMCO is looking for external expert institutions is that the number of corporations reaching their limits has been increasing recently. Various companies in different sectors, including TMON and WeMakePrice, which suffered a large-scale unresolved incident last summer, as well as Homeplus and Balaan, which entered corporate recovery procedures due to credit rating declines, are consecutively undergoing bankruptcy procedures. According to court statistics, as of the end of April this year, the number of corporate recovery cases received is 138, which is an approximately 27.8% increase compared to the same period last year (108 cases).

However, the challenge is that the difficulty of post-restructuring investments to inject liquidity into corporations that have begun recovery procedures is high. A representative from a house managing restructuring funds noted, "I prefer to conduct pre-restructuring before companies enter recovery procedures rather than investing in post-restructuring companies that have already begun the process." Accordingly, KAMCO has also expanded the scope of post-restructuring from recovery procedure corporations and workout corporations to include those rated as C in credit risk assessments, starting from the fifth fund.

KAMCO's temporary pause in its blind fund investment project this year to focus on project fund investments is also cited as a background for selecting external advisory firms. KAMCO sets aside specific amounts for project fund investments each time it conducts corporations restructuring fund projects, but it is reported that thousands of billions won remain uninvested due to a lack of suitable investment opportunities. The role of the advisory firms is crucial as project funds need to be reviewed and invested in whenever deals come in.

The contract period with the advisory firm is at least two years. It is expected to proceed with a method in which reports are submitted after reviewing the deals requested by KAMCO. An industry insider stated, "I expect about 20 project deals and 10 blind deals during the contract period," adding, "It seems they will be responsible for due diligence and valuation documents, reviewing financial statements, and analyzing the recoverability of the investment and restructuring scenarios."