© Archyde.com. 2.4 trillion big deal… MBK embraces intraoral scanner company Medit
Minho Jang, CEO of Medit. Photo = Hankyung DB
▶Market Insight December 29, 9:21 am
MBK Partners, Korea’s largest private equity fund (PEF) manager, signed a main contract on the 29th to acquire Medit, a dental oral scanner company, for approximately KRW 2.45 trillion. According to the investment banking (IB) industry, MBK signed a stock purchase agreement (SPA) to acquire a 99.5% stake in the company from PEF management company Unison Capital, which is the largest shareholder of Medit, for 2.45 trillion won.
The company’s founder, Korea University professor Min-ho Jang and a special related person, will remain as a co-investor with MBK Partners. They plan to sell about 35% of their stake to MBK Partners and reinvest most of the proceeds from the sale. This is because the growth potential of the global digital dental market and Medit is high. When the transaction is completed, MBK Partners will secure 70% of the shares, and Professor Jang and a related person will hold the remaining 30%.
Medit is a company with 3D dental intraoral scanner technology. It was founded in 2000 by Professor Chang, a graduate of the Massachusetts Institute of Technology (MIT). Unison Capital acquired a 50% + 1 share stake at the end of 2019 for about 320 billion won. Since then, Medit has grown rapidly and secured the world’s third largest market share in the intraoral scanner market.
This year, sales and EBITDA are expected to record KRW 270 billion and KRW 150 billion, respectively. It increased significantly from last year’s sales (190.6 billion won) and EBITDA (103.9 billion won). Medit Pan Unison Capital, 6x profit in 3 years ‘jackpot’
MBK, main contract to acquire Medit… The acquisition of Medit, which was considered a ‘big deal’ in the second half of this year, was fiercely contested by global private equity funds (PEFs) such as Carlyle Group in the US, Kohlberg Kravis Roberts (KKR), and CVC Capital in Europe. did it In October, the GS-Carlyle consortium was selected as the preferred bidder for the acquisition of Medit, but when the negotiations collapsed due to a breakdown, MBK Partners, which made a ‘surprising appearance’, became the final winner.
MBK Partners concluded its first trillion-dollar transaction at the end of this year. This year, Kakao Mobility worth 10 trillion won and Megastudy Education worth 2 trillion won were pursued, but failed each time. About 1 trillion won will be invested through the 5th blind fund, which was formed in 2020 for the acquisition of Medit at a scale of $ 6.5 billion.
MBK Partners’ acquisition of Medit is due to the growth potential of the digital intraoral scanner market and Medit’s technological prowess. Medit is one of the few companies in the world leading the digitization of dental practice. If you use Medit’s 3-dimensional (3D) intraoral scanner when making a tooth pattern and making a prosthesis, you can shape the tooth structure in tens of seconds without using rubber clay or plaster molds.
The digital intraoral scanner market is considered a blue ocean. The market penetration rate of 3.9% in 2018 is still only 10-20%. In developed markets such as the U.S. and Europe, the share is less than 30%. It is expected to rise to 30-40% by 2027.
With the sale of Medit, Unison Capital concluded a new landmark deal following the sale of Gongcha, a franchise milk tea brand in 2019. Medit is the first investment of the 2nd blind fund. Through this sale, Unison Capital is expected to achieve a return on investment (MOIC) of about 6.5 times and an internal rate of return (IRR) of 80%.
It is a level that exceeds the performance of the clearance sale. Unison Capital acquired Gongcha in 2014, developed it into a global brand, and sold it to TA Associates, a US PEF, for 350 billion won in 2019. At that time, it recorded about 5.6 times the MOIC and 30% IRR. This transaction was considered the first case in which a domestic private equity fund acquired an overseas franchise headquarters and sold it after enhancing its corporate value. Gong Cha’s management story was selected as a case study at Harvard Business School (HBS) in the United States.
Reporter Kim Chae-yeon why29@hankyung.com
Medit Pan Unison Capital, 6x Profit in 3 Years ‘Great’
3 private equity fund managers who saw the performance ‘bitter’
Three private equity management companies, a direct hit to the stock market slump… VIP turns into a loss
SK Innovation depositing 2 trillion won to its subsidiaries… How to raise funds[[
Next year’s investment keywords selected by ‘PEF’s big hands’
“Private equity fund returns expected to be 11-16%”… Best in 10 years