This article was published on June 4, 2025, at 2:39 p.m. on the ChosunBiz MoneyMove site.
As the sale price of waste incineration company Koentec is estimated to be between 800 billion and 1 trillion won, the sellers have recently entered into non-disclosure agreements (NDA) with 14 potential acquirers. The preliminary bids are expected to take place as early as the 26th.
According to the investment banking (IB) industry on the 4th, Koentec's sale lead underwriters UBS and EY Han Young recently entered into NDAs with 14 prospective buyers interested in acquiring management rights and provided them with investment memorandums (IM). While entering into an NDA does not guarantee participation in the acquisition, the fact that over ten companies received the IM could be interpreted as a positive sign of market interest.
The target for sale is the entire equity stake held by the consortium of IS Dongseo and E&F Private Equity (PE) in Koentec. The consortium currently holds a 100% equity stake in Koentec. After raising its stake to 86.3% through a public purchase, the consortium completed a comprehensive stock exchange for the remaining equity stake on the 30th of last month.
Initially, the consortium considered a comprehensive sale of Koentec, Coreentec, and KR Energy, but ultimately shifted to a separate sale and reduced its size.
Market expectations suggest that if a comprehensive sale of Koentec and the other two companies had proceeded, the corporate value would have approached 2 trillion won. In this case, only a few large domestic companies or global asset managers like KKR and EQT would have participated in the auction, limiting the pool of candidates. However, by opting to sell Koentec separately, the consortium appears to have allowed for more potential candidates to be considered.
The consortium is expected to conduct preliminary bidding around the 26th to 27th and will likely receive letters of intent (LOI). If they do not extend the fund's maturity, the consortium must complete the sale of Koentec within this year. Once the new owner of Koentec is determined, there are plans to sequentially sell Coreentec and KR Energy.
Koentec is a waste treatment company acquired by the consortium through a special purpose corporation (SPC), E&I Holdings, in 2020. It has the largest facility in the country, capable of incinerating 463 tons of industrial waste per day. The total landfill capacity is approximately 4.409 million cubic meters. Last year's revenue was 80.5 billion won, and operating profit was 30.5 billion won.