UCK Partners sues ex-employee in Korea’s 1st PE non-compete case

UCK Partners has sued a former senior employee who joined local rival Premier Partners in June, alleging he violated a non-compete clause, in what is the first case of its kind in South Korea’s private equity industry.

UCK has recently sought an injunction against the unidentified former employee, who had overseen global fundraising and investments over the past three years, according to investment banking sources on Thursday.

A court ruling, expected as early as this month, could set a precedent for future disputes over non-compete agreements in the high-turnover private equity sector amid an intensifying battle for talent.

The legal fight also highlights UCK’s rivalry with Premier Partners, which dominated domestic fundraising in 2024, given their similar assets under management and overlapping investment sectors.

UCK argued that his move to Premier Partners violated a non-compete clause he had agreed to when joining the firm, barring him from working for a rival after leaving.

The dispute, however, centered on an added pledge that he would not use any information obtained at UCK in his new role.

He refused to sign the new clause when he left the firm, arguing it was more restrictive than those of other private equity houses.

In detail, the additional commitments UCK sought included a three-year ban on contacting limited partners he met while at UCK.

Violating the provision would lead to multimillion-won penalties, effectively preventing him from using the overseas LP network he had built during his time at UCK after moving to a new firm.

For his part, he argued that the LP network is not a proprietary intangible asset unique to UCK and that barring him from using it is an unreasonable demand.

He also notes that at Premier Partners he will focus on investments, not overseas fundraising.

UCK has earned the nickname “talent academy” for its higher turnover than other Seoul-based private equity firms.

Six members of its investment team, including the employee now working at Premier Partners, has quit this year -- a rate in line with previous years.

Some have moved to other firms, while others have launched their own ventures.

Since the start of the year, Premier Partners has been actively recruiting mid-level professionals with extensive buyout experience as it is raising a private equity fund in the billion-dollar range.

Originally launched as a venture capital firm in 2005, it has expanded into private equity, building a strong track record in minority stake and mezzanine investments with about $1 billion in assets under management.

Write to Jong-Kwan Park and Jun-Ho Cha at pjk@hankyung.com
 

Yeonhee Kim edited this article.