Han & Company broadens its horizons beyond buyouts as exits bear fruit

The defining theme for Han & Company this year is "next step." Portfolio companies carved out from large conglomerates and built into independent businesses are being handed to new owners, while long-held assets are being restructured to prepare for the next phase of growth.

Han & Co. has posted a string of notable results in the exit market. Amid growing concern among limited partners over delayed distributions across the private equity industry, the firm's successful completion of several major exits has reinforced its reputation as a premier buyout house. A distinguishing feature has been its ability to sell companies not merely after improving their earnings, but after laying the groundwork for future buyers to expand the business further.

The standout result by far is the sale of K Car. Han & Co. completed the transfer of K Car and K Car Capital to KG Group in August, selling a 72.19 percent controlling stake in K Car for approximately 550 billion won ($398 million) and a 100 percent stake in K Car Capital for around 200 billion won. The deal demonstrated that a company can continue to grow substantially after leaving private equity ownership, challenging the perception that private equity funds pursue only short-term gains.

With K Car, Han & Co. delivered a textbook carve-out. In 2018, it acquired SK Encar's directly operated dealership division and CJ Group's Joy Rent-a-Car for 200 billion won and 50 billion won, respectively, rebranding them under the K Car name. At the time, the market watched closely to see whether the business could survive independently without the SK brand.

The most significant transformation was the integration of used-car sales and financing. Han & Co. established K Car Capital directly to offer installment financing alongside vehicle purchases, improving convenience for customers. Aggressively expanding online channels — including home services for buying and selling vehicles — also helped broaden customer touchpoints and enhance brand value.

When Han & Co. rebranded the company as K Car in 2018, it started by changing the logo, embedding passion in the red and trust in the gray. The firm steadfastly pursued a directly operated sales model, instilling confidence in the used-car market, and drove strong earnings growth through an energetic value-enhancement strategy. Last year, sales and operating profit reached record highs of 2.44 trillion won and 76 billion won, respectively.

The phased exit strategy was equally impressive. Han & Co. listed K Car on the Kospi in 2021 — the first used-car company to do so — and recouped its principal investment by raising 300 billion won through secondary share sales. It then maintained management control while continuing to build brand value before completing a full exit. The eight-year investment journey — from acquiring a conglomerate division, to building an independent brand, to listing, to a strategic sale — left a deep impression on the market.

In March, Han & Co. signed a share purchase agreement to sell Korean Air Lines C&D Services back to Korean Air Lines for 750 billion won. Han & Co. had stepped in as a white knight for the aviation industry during the COVID-19 crisis in 2020, acquiring Korean Air Lines' in-flight catering and duty-free operations and building them into a solid business with double-digit operating profit margins.

Korean Air Lines navigated the crisis with Han & Co.'s support and is now pursuing a reacquisition to strengthen its service competitiveness as the aviation industry stabilizes. A Korea Fair Trade Commission merger review is currently under way, and the transaction is expected to close by year-end given the timeline for the Korean Air Lines–Asiana Airlines integration.

Han & Co. also completed the sale of its remaining stake in SK Eternix. After acquiring SK D&D in 2018, it spun off the renewable energy and energy storage system business into SK Eternix in March 2024. Two block deals in 2024 and 2025 returned approximately 150 billion won, and this year the firm sold its remaining 12.52 percent stake to KKR for 100 billion won, completing the exit.

A sweeping restructuring is under way at the firm's long-held shipping assets. SK Shipping is transitioning into a gas-specialist carrier focused on LNG and LPG, while H-Line Shipping — formerly Hanjin Shipping — has added oil tankers to its portfolio to further increase the share of high-quality domestic cargo owners. The effort goes beyond improving financial structure and profitability; it is about sharpening the distinct identities of SK Shipping and H-Line Shipping.

In February, Han & Co. sold SK Shipping's very large crude carrier division to Pan Ocean for around 1 trillion won and is also pursuing a fleet swap between SK Shipping and H-Line Shipping. SK Shipping will take over H-Line Shipping's LNG carriers to complete its transformation into an LNG and LPG gas-specialist carrier, and plans to rename itself K-LNG. H-Line Shipping, meanwhile, will add oil tankers to its existing dry bulk and pure car and truck carrier fleet. With each company's core market and growth drivers now clearly defined, investor predictability has improved considerably.

The turnaround at Namyang Dairy Products, freed from the risks associated with its former controlling family, is also worth noting. After fully securing management control in 2024, Han & Co. introduced an executive officer system to establish professional management. With the board handling major decisions and executive officers running day-to-day operations, earnings have improved rapidly. Last year, the company posted consolidated sales of 914.1 billion won and operating profit of 5.2 billion won, returning to profitability for the first time in five years. Operating profit in the first half of this year reached 1.8 billion won, up 80 percent from the same period a year earlier.

The company also announced a large-scale shareholder return package. It disclosed plans for a 20 billion won share buyback and cancellation and paid a year-end dividend of 3 billion won. The 8.2 billion won deposited with the court by former Chairman Hong Won-sik's family during their embezzlement and breach-of-fiduciary-duty trial was used to fund a special dividend. The moves reinforced the message that transparent governance benefits both the company and its shareholders.

SK D&D faces the challenge of proving its recovery amid a deteriorating real estate market. To support the company's long-term growth, Han & Co. provided liquidity through a 136.7 billion won rights offering while pledging not to pursue a delisting for at least three years — a declaration of solidarity with minority shareholders.

Han & Co. itself is changing. Earlier this year, the firm established a separate asset management subsidiary, HCAM, to prepare for real estate fund management. While other private equity managers active in Korea have experimented with growth capital, credit investments and other strategies, Han & Co. has until now walked a single path of buyout investing — a strategy it is now moving to diversify.

The firm is adding a new asset class to its buyout-focused management structure to expand investment opportunities. It is expected to diversify its business model by drawing on the real estate market expertise it has built through investments in SK D&D and Rahan Hotel. The value-enhancement strategies honed across its existing portfolio are expected to translate into strong performance for the new fund.

An organizational overhaul is also under way. The firm promoted Executive Vice Presidents Lee Dong-chun and Jo Seong-gwan to senior executive vice president — the first time Han & Co. has conferred that title. Senior Executive Vice President Lee will serve as chief portfolio officer and Senior Executive Vice President Jo as chief investment officer as they chart the firm's future.