Korea's top WAS provider Tmax Soft put up for sale at a worth of $338 mn

South Korea’s No.1 web application server (WAS) provider Tmax Soft Co. is put up for sale, grabbing interest from IT companies to private equity firms at home and abroad for a deal that could cost more than 400 billion won ($337.9 million) for its high profitability and bright outlook.

The tender involves a 60.7 percent controlling stake in Tmax Soft. The sale’s lead manage Samjong KPMG has sent out a letter to potential buyers, according to investment banking sources on Thursday. The sale price is estimated at more than 400 billion won based on its current market value at the local over-the-counter market.

Tmax Soft is a software and IT solution provider founded in 1997. It is famous for its web application server JEUS that commands the largest share of around 40 percent in the Korean market. The JEUS has become the top WAS in the country since 2003 by beating global tech giants including Oracle and IBM.

The company’s earnings before interest, taxes, depreciation and amortization (EBITDA) reached 55 billion won in 2020, more than half of its total revenue of 100.8 billion won.

Market experts expect the sale would draw great interest from private equity funds (PEFs) and tech firms at home and abroad. An official from a PEF said that a tech company with sound profit-making structure like Tmax is rarely placed up for sale so many funds are showing interest.

The Korean WAS market is expected to grow rapidly due to the accelerated digital transformation efforts in many industries. The prolonged pandemic has also been boosting software demand, leading to a respective of 20 percent and 42 percent year-over-year growth in revenue and operating profit of Tmax in the first six months of the year. Tmax is also the provider of e-learning platform used by most public schools for remote class during school shutdowns in Korea.

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