Seoul-based investment firm IMM Private Equity is reportedly in the final stages of selling Hollys Coffee to agricultural, chemical and food business KG Group
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Holly's Coffee first opened in 1998 and operates around 560 stores across South Korea today | Photo: Jericka Ancheta
The sale price of the 560-outlet coffee chain will be within the range of 150bn-200bn won ($126m-$168m) and marks third time IMM has attempted to offload Hollys Coffee, which it acquired for 82bn won in 2013, the
Korea Economic Daily has reported.
KG Group has several agricultural and chemical interests, but has invested in Korea’s lucrative food and beverage franchise industry in recent years. In 2017 it acquired the KFC South Korea franchise business from Luxembourg-based investment firm CVC Capital Partners for an undisclosed sum.
Coffee shops are
big business in South Korea, with market leader Ediya Coffee operating some 3,000 outlets in 2019. Founded in 1998 Hollys Coffee operates a franchise structure and has grown from around 380 outlets in 2013 to 560 across South Korea today. 2019 revenues were reported to be 165bn won ($139bn), up from 68bn won ($57m) in 2013.
South Korea initially achieved success in containing coronavirus in early 2020, but has suffered a resurgence of cases in August. This has led to coffee shops being restricted to takeaway trade-only, with tough social distancing rules slowing retail footfall across the country and severely disrupting the hospitality industry.