Cleanwrap, Korea's Top Kitchen Supplies Maker, Sold to Domestic PEF

Cleanwrap, a 40-year-old company synonymous with kitchen plastic wrap in Korea, is being sold to a domestic private equity fund consortium, following a prolonged succession dispute that weakened the market leader's business operations.

According to investment banking sources on December 7, Pointers Private Equity and Esang Partners consortium has agreed to acquire a 53.73% controlling stake in Cleanwrap for approximately 67 billion won ($47 million) and is currently recruiting institutional investors for the fund.

The acquisition targets 51% of shares held by Jeon Ki-young, the founder's eldest son and current largest shareholder who owns 76.4% of the company, plus 2.73% held by the Ministry of Economy and Finance.

The two sides have signed an exclusive term sheet outlining the investment conditions. The Pointers PE-Esang Partners consortium conducted due diligence on the company from August through October and has established a funding strategy of up to 80 billion won.

The consortium plans to negotiate the final price with the seller and execute a share purchase agreement once funding is largely completed. Industry observers expect the ownership transfer to be finalized next year after the SPA signing and capital injection are complete.

Following the acquisition, the consortium plans to make additional investments in the company and pursue new business initiatives to achieve Cleanwrap's second phase of growth.

The sale comes after a management dispute between the founder's eldest and second sons following the founder's death significantly weakened the company's business capabilities, ultimately leading to the divestiture of the iconic national brand and industry leader in kitchen supplies.