Recently, according to media reports, South Korea’s Aekyung Group has put its core subsidiary, Aekyung Industrial, up for sale in an effort to reduce the debt of its holding company, AK Holdings. This move marks the group’s decision to restructure its homecare and cosmetics business, which has long been the foundation of the group.
According to sources in the investment banking (IB) industry, Aekyung Group has recently appointed Samjong KPMG as the lead advisor and has begun the sale process for Aekyung Industrial. The sale includes a 63.38% controlling stake in Aekyung Industrial held by AK Holdings, Aekyung Asset Management, and other affiliated entities.
Based on Aekyung Industrial’s closing market capitalization of KRW 382.9 billion ($261 million) on April 1, the equity value of the stake amounts to approximately KRW 242.6 billion ($165.4 million). However, considering management control premiums and asset value, the total sale price is expected to reach several hundred billion KRW.
Public records show that Aekyung Group was founded in 1950 and was once known as “South Korea’s largest listed daily chemical company.” AK Holdings, the group’s holding company, manages businesses across aviation, chemicals, homecare products, retail, and real estate development through its subsidiaries Jeju Air, Aekyung Chemical, Aekyung Industrial, AK Plaza, and AMPLUS Asset Development. Among them, Aekyung Industrial is best known for its homecare brand Kerasys and cosmetics brand Luna.
Financial reports indicate that Aekyung Industrial generated revenue of approximately KRW 679.1 billion ($462.9 million) last year, with cosmetics accounting for about 60% and homecare products for 40%. However, the company’s market position has weakened—once ranked among the top three beauty product companies in Korea, it fell to fifth place last year. This was largely due to its heavy reliance on the Chinese market, which contributes around 70% of its overseas sales. Competitors such as Goodai Global and APR have surpassed Aekyung Industrial through successful expansion in North America.
It is understood that since the crash involving Jeju Air at Muan International Airport at the end of last year, the stock prices of Aekyung Group’s subsidiaries have continued to decline, further worsening the group’s financial difficulties. As of the end of last year, AK Holdings’ total debt stood at approximately KRW 4 trillion ($2.73 billion), and its consolidated debt ratio surged from 233.9% in 2020 to 328.7% in 2024.
Reports state that AK Holdings and Aekyung Asset Management hold 63.16% and 53.59% stakes in Aekyung Industrial and Jeju Air, respectively, much of which has been pledged. If stock prices fall further, Aekyung Group may face margin call risks. To mitigate this, the group is seeking to improve liquidity by selling Aekyung Industrial and repaying a substantial portion of its debt. The decision to sell Aekyung Industrial aims to preserve key businesses such as Jeju Air and AK Plaza.
In addition to Aekyung Industrial, the group is also considering selling non-core assets such as the Jungbu Country Club and is currently seeking real estate buyers. A representative from Aekyung Group stated, “This is part of the financial restructuring review we are currently undergoing.”
