TPG in talks to sell global LVT flooring leader Nox

Texas-based private equity fund TPG Inc. is seeking to cash out on its controlling stake in South Korea’s Modem Corporation, parent of South Korea-based global luxury vinyl tile (LVT) flooring leader Nox Corporation, at about 600 billion won ($420.7 million), five years after its acquisition.

Morgan Stanley manages the sale as lead adviser, according to investment banking sources on Thursday. Potential candidates have received teaser letters, and the seller is considering a closed tender.

“TPG is reviewing various options strategically,” said a source close to the sale.

TPG reportedly hopes to sell its 85 percent stake in Moleem at an estimated 600 billion won. It acquired a 65 percent stake in Nox for 360 billion won in 2017. Industry experts are closely watching whether Nox President and CEO Dan Koh’s 35-percent holding would be included in the sale deal or not. If included, the sale could fetch up to 1 trillion won.

Nox, founded in Korea in 1994, is a global leader in the LVT flooring market with a 20 percent share. It has established the entire stages in production of LVT flooring from raw materials processing to machinery and production system to meet the growing demand from the United States and Europe.

Based on more than 5,000 product designs, its LVT flooring has been used in Marriott and W hotels in New York, Paris Charles de Gaulle Airport lounge and Hermes outlet in Paris.

Nox is better known in overseas than at home and boasts strong production competitiveness, capable of producing urethane layer to fiberglass mat, designer printed visual, and protection film, according to the company.

The company last year delivered an operating profit of 34.2 billion won on sales of 282.5 billion won, of which 90 percent from overseas markets. Exports to the U.S. took up the largest 50 percent, and business in France and Japan also contributes much to its revenue.

Nox has production lines in Ohio, the U.S. and Vietnam. It acquired the Korean factory of window coverings like blinds maker Hunter Douglas earlier for inroads into the woven fabrics living and interior market.

by Kang Woo-seok and Lee Ha-yeon