A South Korean consortium led by AJ Group has completed acquisition of the country’s top motorbike manufacturer Daelim Motorcycle Co., a move that will help AJ accelerate its plan to transform from traditional two-wheel business into an electric scooter manufacturing and sharing business.

According to multiple sources from the investment banking industry last week, a consortium of AJ Group, A2 Partners, and Rhinos Asset Management has recently completed its takeover of Daelim Motorcycle, about two months after it signed a stock purchase agreement on July 9 to buy full stake in the motorcycle maker owed by Daelim Industrial and Affirma Capital.

The consortium created a project fund worth 55 billion won ($47.3 million) to buy Daelim Motorcycle and AJ Bike, of which 30 billion won was dedicated to buying existing shares and 20 billion won in issuing new shares.

Institutional investors such as mutual aid associations and capital firms assumed 40 billion won in senior equity and AJ Group in 15 billion won subordinated tranche. AJ Group was given the right of first refusal for Daelim Motorcycle and AJ Bike.

Sources noted that the consortium decided to acquire to Daelim Motorcycle and AJ Bike in package to boost business synergy. AJ Bike is responsible for motorcycle rental business within AJ Group. It is under AJ M, the holding entity of AJ Group’s mobility business.

An unnamed industry official said that it would be the best scenario for AJ Group that took part as subordinate investor to buy both Daelim Motorcycle and AJ Bike in the future for mid- to long-term synergy creation.

With Daelim Motorcycle, the country’s top motorcycle manufacturer that produces environmentally-friendly two-wheeled vehicles, under its umbrella, AJ’s plan to jump into the electric mobility market is expected to pick up speed. AJ Bike is already the top player in the country’s two-wheel vehicle rental market.

AJ Group-led consortium aspires to groom the two companies as Korea’s Gogoro, world’s leading electric two-wheeled vehicle sharing platform dubbed as scooter industry’s Tesla. The Taiwanese company launched an electric scooter in which drivers are able to check remaining battery via smartphones.

AJ Group plans to expand customer base such as franchise delivery service to secure growth engine and to nurture the two companies as a mobility manufacturer and service provider like Gogoro.

By Kang Woo-seok and Lee Eun-joo

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