Hanwha Hotels & Resorts said on Nov. 25 it would split off its food culture division and sell it to South Korea’s private equity firm VIG Partners in the deal that was roughly valued at some 100 billion won ($85 million).
The leisure industry arm of chemical-to-financial conglomerate of Hanwha said it has signed a sale and purchase agreement for the sale of its newly created food subsidiary as a result of the split-off, but declined to elaborate on the exact sale price.
The food culture division of Hanwha Hotels & Resorts has been dedicated to food catering service, foodstuff distribution, dining franchise operation and concessions business -- providing food and beverages at a multi-purpose facility.
Industry watchers say VIG Partners will seek a bolt-on acquisition strategy through its portfolio company dedicated to foodstuff retailer, Win-Plus, so that the two companies will be consolidated and create a synergy effect.
The transaction is expected to be complete by early 2020.
The news came after a collapse of talks between Hanwha Hotels & Resorts and CJ Freshway, which was selected as the preferred bidder in July.
Hanwha Hotels & Resorts’ food service division has logged an operating profit of 7.4 billion won in 2018.
VIG Partners, since founded in 2005, has invested over $2 billion capital across 20 portfolio firms in Korea, holding controlling stakes in 17 of them.
By Son Ji-hyoung (firstname.lastname@example.org)