Global logistics companies and private equity funds of South Korea are fighting over Logen Co., a local parcel delivery service company put up for sale by Hong Kong-based private equity fund Baring Private Equity Asia.

According to the investment banking industry on Thursday, the preliminary bid led by Baring PEA and its sale agent JPMorgan Chase & Co. drew multiple bidders including multinational logistics names like United Parcel Service of America, Inc. (UPS) and DHL International GmbH as well as private equity funds at home and abroad such as KKR & Co. L.P. and CVC Capital Partners. Baring PEA is offering its 100 percent stake in Logen. It had bought the full stake for 158 billion won (135.86 million) from Mirae Asset Private Equity in 2013. The market estimates the sale price for Logen to come between 300 billion won and 400 billion won.

Global logistics companies UPS and DHL are eying Logen amid burgeoning e-commerce and online shopping in Korea and as part of expansion to the Asian market.

Private equity firms also believe the logistics business is lucrative investment. Moreover, Logen is a solid company with a loyal client base and growing earnings.

Unlike other parcel delivery service companies, Logen is based on the customer to customer (C2C) business that connects deals between merchants and consumers. Logen last year bought a 70 percent stake in KGB Logis Co. for 25.0 billion won, making it the industry’s fourth with a combined market share of over 10 percent.

Logen recorded 20.7 billion won in operating profit on sales of 263.5 billion won last year. The combined earnings before interest, taxes, and amortization of the Logen and KGB Logis are estimated at 40 billion won for this year, up from last year’s around 30 billion won.

JPMorgan is expected to select shortlisted candidates based on the bid price and finalize the sale within the first half.

By Kang Doo-soon, Kim Hyo-hye

[ⓒ Pulse by Maeil Business Newspaper & mk.co.kr, All rights reserved]