Courtesy of Myongnyundang

This article was posted on ChosunBiz MoneyMove at 10:57 a.m. on June 23, 2025.

As the sale of management rights for Myungryeondang, which operates the charcoal-grilled pork ribs franchise brand "Myungryeon Jinsagalbi," is delayed, the company is actively replacing Myungryeon Jinsagalbi stores with the all-you-can-eat shabu-shabu franchise "Shabu All Day" in an effort to enhance corporate value. While Myungryeon Jinsagalbi's performance is declining, Shabu All Day is showing strong results as Myungryeondang's star brand.

Last year, Myungryeondang selected Forest Partners, a private equity fund manager, as the preferred negotiator for acquisition, but even after eight months, it has struggled to attract institutional investors and has not yet signed a stock purchase agreement. In this situation, they have opted to switch their main franchise brand. There is interest in whether this strategy will lead to improved performance and an increase in corporate value, thereby speeding up the sale.

According to the investment banking industry on the 23rd, Myungryeondang is known to be actively supporting existing Myungryeon Jinsagalbi store owners in changing their signs to Shabu All Day.

Shabu All Day, which opened its first store in July 2023, has been experiencing rapid growth, opening 90 new stores in just five months this year.

According to the company, about 35% (61 stores) of the 174 locations currently operating or preparing to open have been renewed (redesigned) to Shabu All Day byformer Myungryeon Jinsagalbi store owners or have opened additional stores. The direct stores opened by the parent company's special relationship entity account for 47% (82 stores).

There are claims that several store owners are working together, or that Myungryeondang is providing funding while store owners only lend their names to establish stores. A former store owner of Myungryeon Jinsagalbi stated, "Starting a Shabu All Day franchise requires an initial expense of about 1 billion won, so very few people do it with 100% of their own funds; many tend to take loans from the headquarters or partner with several individuals," adding, "I heard that when starting a Shabu All Day franchise, the headquarters would support full interior and full loans."

Industry insiders analyze that Myungryeondang's active support for the transition to Shabu All Day or new openings is aimed at accelerating the sale of management rights through improved performance.

Forest Partners was selected as the preferred negotiator for the acquisition of Myungryeon Jinsagalbi last October. They decided to acquire management rights for a total of 160 billion won, with 120 billion won for existing shares and 40 billion won for new shares. They plan to invest 100 billion won as equity and raise the remaining 60 billion won through acquisition financing.

However, Forest Partners has not yet signed the main contract. They are seeking funding with the goal of completing the closing (payment of the acquisition price) within the year, but the response from limited partners (LPs) has been lukewarm. It is known that a strategic investor (SI) engaged in the food ingredient business has participated, but they are facing difficulties in attracting financial investors (FIs), and there has been no progress in the deal.

To win over key LPs, Forest Partners has recently changed the structure of equity acquisition. Initially, they planned to acquire only 30% of the equity of All Day Fresh, a subsidiary that operates Shabu All Day, and only secure a call option for the remaining 70%, but they have now pivoted to securing this 70% outright. This decision was made based on the assessment that the growth potential of Shabu All Day is much higher than that of Myungryeon Jinsagalbi.

This is a post on a Naver cafe from a self-employed person. /Courtesy of Naver cafe capture

Recent controversies surrounding Myungryeondang are also causing LPs to hesitate. Myungryeondang is under suspicion of providing high-interest loan services to franchisees who lack initial capital through a special relationship company that effectively operates as a moneylender after borrowing funds at low interest from commercial banks.

A representative from Landmark Law Firm, representing former and current franchisees of Myungryeon Jinsagalbi, who reported Myungryeondang and its co-CEO for alleged similar reception and breach of trust, stated, "We suspect that after lending money in the form of angel loans through more than 10 lending companies that Myungryeondang effectively operates, they secured a certain portion of returns when purchasing products or placed mortgages on stores to strengthen their control over franchises while simultaneously increasing the number of stores to enhance the attractiveness of the sale to private equity funds."

Meanwhile, ChosunBiz sent an inquiry about illegal loan allegations to Myungryeondang via email but did not receive a response.