Coffee chain operator opts not to go public
A South Korean coffee chain operator, A Twosome Place, opted not to go public as brokerages’ valuation fell far short of its original expectation, according to a source familiar with the source on June 3.
The company, which is held by Hong Kong-based private equity fund Anchor Equity, was initially expected to carry out an initial public offering during the first half of 2022.
Toward that end, the Seoul-based outfit accessed three potential IPO managers of NH Investment & Securities, KB Investment & Securities, and Samsung Securities.
“A Twosome Place hoped that its value would approach 1 trillion won ($900 million). But the candidates of IPO managers set the figure at between 500 billion won and 600 billion won,” said the source who asked not to be named.
“That’s why A Twosome Place decided to quit. Anchor Equity may strive to sell off the coffee store operator.”
Anchor Equity channeled around 450 billion won into acquiring 100 percent of A Twosome Place from CJ Foodville between 2018 and 2020.
And it chalked up handsome results last year as its 2020 operating profit amounted to 38.8 billion, up 8.7 percent from a year. Its sales also jumped at a double-digit rate despite the virus pandemic.
The coffee house is expected to improve its bottom lines this year as the world tries to deal with the economic aftermaths of COVID-19 through vaccines.
When contacted, the entity’s official refused to make comments.
The IPO of A Twosome Place was expected to encourage its rivals to follow suit. But as it has given up, it remains to be seen how they will react.
Included in its competitors are Hollys Coffee and The Coffee Bean & Tea Leaf.
Korea’s KG Group acquired the former from IMM Private Equity last year, while the latter was acquired by Jollibee Foods Corp of the Philippines midway through 2019.