Korean waste management firm Koentec on market for $730 mn

Korea Environment Technology Co. (Koentec) is up for sale in a deal that could fetch up to 1 trillion won ($730.4 million) with global private equity firms aiming to acquire the country’s largest waste management company, investment banking industry sources said on Monday.

A consortium between Seoul-based E&F Private Equity and IS Dongseo Co. selected four qualified bidders -- two global private equity firms and two strategic investors whose businesses are similar to Koentec's -- to sell a 100% stake in the company.

The seller plans the main bidding as early as the end of August after due diligence with a schedule to select a preferred bidder in September to complete the sale this year.

UBS and EY Hanyoung, the South Korean partner to Ernst & Young Global Ltd., manage the deal.

The consortium increased its stake in Koentec to 86.3% through a tender offer and completed a comprehensive share swap for the remaining shares for the company’s delisting.

TO SELL ONLY KOENTEC

Koentec operates the largest industrial waste incineration facility in South Korea with a capacity of 463 tons a day. Its operating profit fell 11.3% to 30.5 billion won in 2024 although sales rose 2.2% to 80.5 billion won.

E&F and IS Dongseo acquired a 59.29% stake in Koentec for 421.7 billion won in 2020.

The consortium had considered selling Koentec together with its related portfolio companies – Core Energy Technology Co. and Cleantech Co., the parent of waste fuel recycling firm KR Energy Co. – in a package deal. The seller decided to unload only Koentec, however.

The consortium took over the entire stake in Core Energy Technology for 540 billion won in 2022.

Write to Jon-Ho Cha and Da Eun Choi at chacha@hankyung.com
 
Jongwoo Cheon edited this article.