Stic Investments nears launch of W1tr fund

Private equity fund manager Stic Investments is nearing the full deployment of its growth capital unit's existing blind fund, as it moves to acquire Kidsnote, the country's top mobile communication app for parents of infants and toddlers.

With its PE unit — which handles large-scale buyouts — also approaching the end of its investable capital, Stic Investments plans to complete the formation of a new 1 trillion won ($723 million) blind fund by year-end and accelerate its push to reload firepower for the next round of investments.

According to investment banking industry sources Wednesday, Stic Investments formed a consortium with Kidsnote Chief Executive Choi Jang-wook and Solon Private Equity and recently signed a share purchase agreement to acquire the entire stake in Kidsnote held by Kakao Investment — a 47.59 percent interest.

Stic Investments is funding the acquisition through its existing Stic K Growth Private Equity fund, known as the Stic K Growth Fund. The fund is a 230 billion won blind fund that the growth capital unit formed in 2023. It previously invested in energy tech company H Energy and acquired Seoul Airport Limousine from Tmap Mobility.

Kidsnote, the acquisition target, is a notification platform with a dominant share of the nationwide kindergarten and daycare center market and has been solidifying a profitable structure. Last year, Kidsnote posted sales of 24.5 billion won, growing more than 48 percent from the prior year, while staging a turnaround by swinging back to profitability after a loss the year before.

As the growth capital unit steadily deploys its capital, the PE unit handling large buyouts is also running low on undeployed funds. The roughly 2 trillion won blind fund Stic Opportunity No. 3, which the PE unit formed and has been managing since 2023, is expected to exhaust most of its remaining dry powder after one or two additional acquisitions.

While the PE and growth units focus on deploying their existing funds, the credit unit has been the pillar of Stic's investment performance this year. The credit unit actively employed structured loans, mezzanine financing and private credit instruments — anchored by a downside protection strategy — to respond nimbly to a highly volatile market environment.

This year, the unit made active investments across a range of companies, including contact lens maker Interojo, cell and gene therapy developer Kolon TissueGene, waste management firm ECO Solutions and genomics company LabGenomics, achieving solid returns while limiting risk.

In step with the smooth deployment of its existing funds, Stic Investments is throwing its full weight behind forming a new 1 trillion won blind fund by year-end. Fundraising from limited partners is also progressing smoothly. The firm recently received a 200 billion won commitment from Korea Development Bank in the second round of sub-manager selection for the National Growth Fund's indirect investment track, and had earlier been chosen as a general partner for the Export-Import Bank of Korea's Regional-Led Growth Fund in the mid-size category, securing 50 billion won in anchor capital.

With commitments from policy finance institutions supplemented by a string of letters of commitment from commercial banks and major financial firms, Stic Investments has cleared what observers describe as the final hurdle toward closing the 1 trillion won fund. The firm plans to complete its internal investment review and fund registration process before formally launching the large blind fund by year-end, at which point it will begin sourcing new deals and resuming mid-market investments in earnest.

an@heraldcorp.com