MBK Partners says Osstem, Medit merger not under consideration

MBK’s partner Kim Kwang-il [Photo by Kim Ho-young]

MBK Partners, which is pursuing a tender offer for Osstem Implant Co. in partnership with Unison Capital Korea (UCK), is not considering a merger between the dental implant maker and Medit Inc., a local 3D oral scanner manufacturer under MBK’s belt, dismissing market rumors of a merger for potential Nasdaq listing, according to MBK’s partner Kim Kwang-il.

“Osstem Implant and Medit have different composition of fund investors or limited partners who are participating in the investment, making a merger difficult,” Kim said in an interview with Maeil Business Newspaper Thursday.

Dentistry Investment, a special purpose company established by MBK Partners and UCK, is conducting a tender offer for Osstem Implant until Feb. 24.

“The primary goal of this tender offer is to improve corporate governance and secure stable management rights necessary to develop Osstem Implant into a global leading company,” Kim said. “In the mid- to long-term, we can expect business synergies between Osstem Implant and Medit as Osstem Implant has a high market share in the Chinese market and Medit has a solid sales channel network in the U.S. and Europe.”

It is the first time in Korea that a private equity fund has made a tender offer that encompasses shares from minority shareholders since Citibank took over Hanmi Bank in 2004 through a tender offer.

MBK Partners has a track record of successful M&As through multiple tender offers in Japan and China.

MBK Partners has conducted nine M&A deals in Japan, of which six were achieved through a tender offer. Of these, Tasaki & Co., a Japanese jewelry brand, was acquired by MBK Partners while the company was under attack from activist funds. This is similar to the situation at Osstem Implant, which is in conflict with Korean activist fund Korea Corporate Governance Improvement. In China, MBK Partners made a tender offer for two leading car rental companies, eHi Car Services and Shenzhou Car Rental Co.

MBK Partners is attracting attention from the investment banking industry for its increasing investments in businesses that can benefit from the aging population.

In Japan, MBK Partners invested in Tsukui Co., a nursing company for the elderly, in 2021, and more recently acquired a senior day care center.

“As Korea is now set to become a super-aged society, we are gradually increasing related investments as we see the growth potential in the senior service industry,” Kim said. “Dental care is a key beneficiary from the aging society. As digitalization is progressing faster than other medical fields, the 3D oral scanner and digital implant market is expected to continue growth.”

Kim earned fame as an M&A lawyer at Kim & Chang, Korea’s top law firm, before joining MBK Partners in 2005. He has been involved in major buyouts like HomePlus and Lotte Card deals while collaborating with MBK Partners co-founder Michael Kim and partner James Yoon.