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Korean private equity firms raise bets on Southeast Asian ventures

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By Anna J. Park

Local private equity companies are increasing their investment in Southeast Asian venture capital businesses, as they see further growth potential in the region.

Vietnam, in particular, is one of their favored areas. Korea-headquartered STIC Investments recently decided to participate in the Series E round investment for Tiki, one of Vietnam's largest e-commerce businesses.

The e-commerce company raised about $258 million in the Series E funding, boosting its corporate valuation to nearly $1 billion from the round.

Mirae Asset-Naver Asia Growth Fund also participated in the fund raising, alongside global insurance firm AIA, Taiwan Mobile and Yuanta Fund.

STIC Investments, which has diverse investment portfolios in the Southeast Asian region, including Vietnam and Malaysia, also stepped up as one of major shareholders of Carousell ― a Singapore-based online market place start-up ― a couple of months ago. The Korean PEF led the latest $100 million round of investment, bringing the start-up's valuation to over $1 billion.

STIC Investments was also one of many Korean private equity funds ― Mirae Asset-Naver Asia Growth Fund, LB Investment and LINE Ventures ― that together invested $33 million in Indonesia's online grocery delivery service, HappyFresh. As Indonesia boasts a large population and a fast-growing market, the country has been one of the favorite investment locations among Korean PEFs.

Korea Investment Private Equity also injected $200 million into Vietnamese conglomerate Masan Group ― the country's major food and beverage company ― taking a 2 percent to 3 percent stake in the company.

IMM Investment invested in Vietnam's Masan Group in 2018; and Vingroup in 2019, along with SK Group.

According to Preqin's alternative investment research report, the private equity and venture capital market in 10 Southeast Asian countries has more than doubled over the past five years. The amount of private equity and venture capital invested in the region stood at $37 billion, a 117 percent jump from $17 billion in 2015.

Some market insiders say one of reasons why Korean PEFs are actively placing bets in Southeast Asian regions is the growing uncertainty regarding regulatory policies in China. The Southeast Asian countries' large populations along with booming e-commerce platforms looks promising to Korean PEFs in generating solid returns on investment.

Park Ji-won


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