SEOUL, September 29 (AJP) - Taekwang Industry has been selected as the preferred bidder to acquire a controlling stake in Aekyung Industry, a move its leadership is casting as a strategic entry into South Korea’s booming K-beauty market.
The company said Monday that its consortium would purchase about 63 percent of Aekyung’s shares in a deal valued at roughly 400 billion won, or $293 million. If completed, the transaction would mark a significant shift for Taekwang, which has long been rooted in the textiles and chemicals businesses.
Yoo Tae-ho, Taekwang’s chief executive, told shareholders in a letter that the acquisition was “not merely financial but a strategic move,” intended to give the company a foundation in cosmetics and personal care, one of South Korea’s most visible global exports. He described the beauty sector as a platform for broader expansion and pledged continued investment.
The acquisition comes as Taekwang seeks to stem losses from its traditional businesses. The company has posted three straight years of operating losses, including a 16 billion won deficit in the first half of this year, pressured by volatile raw material prices, China’s capacity expansions and a global slowdown.
In response, it has shuttered its cotton spinning unit, restructured its low-melting fiber business and suspended spandex production in China.
While paring back weaker divisions, Taekwang has pushed into specialty fibers and chemicals — including modacrylic fibers used in wigs, aramid fibers for industrial applications, and sodium cyanide for gold mining. CEO Yoo said the company would “optimize low-profit businesses and maximize competitiveness” by expanding in areas with proven returns.
For now, however, the Aekyung deal underscores Taekwang’s ambition to diversify into a consumer-facing industry with global reach, Yoo said.
The K-beauty market, propelled by South Korea’s cultural influence abroad, is widely viewed as one of the country’s fastest-growing export sectors.
* This article, published by Economic Daily, was translated by AI and edited by AJP.
Copyright ⓒ Aju Press All rights reserved.
