No & Partners Beats U.S.-Based Lam Research to Acquire 'Dawon Powertron' [fn Market Watch]

[Financial News] No & Partners, a domestic private equity fund (PEF) manager, is set to acquire Dawonsys subsidiary Dawon Powertron, beating U.S.-based Lam Research, the world's No. 1 etching-equipment maker. Dawon Powertron was established after Dawonsys spun off its semiconductor power-supply division in June last year. It makes power supplies that precisely control plasma waveforms in semiconductor etching and deposition processes. The company is said to have localized technology previously led by a small number of overseas firms and to have been the first in Korea to apply it to a semiconductor mass-production process.
According to investment banking (IB) industry sources on the 13th, the Engineering Mutual Aid Association, Dawonsys, and EY Hanyoung, the sales adviser for the sale of Dawon Powertron, selected No & Partners as the preferred bidder on the 10th.
The deal is valued at around 30 billion won, and six firms, including Lam Research and Comet, reportedly participated in the bidding.
No & Partners is expected to sign a stock purchase agreement (SPA) with the seller soon.
Some say a Korean investor has protected K-semiconductor by acquiring Dawon Powertron, which has localized pulse power supplies based on precision waveform-control technology and established mass-production capabilities in the highly import-dependent front-end semiconductor sector.
Lam Research was initially considered a strong potential buyer, given its status as a customer of Dawon Powertron. Dawon Powertron's predecessor, Dawonsys' semiconductor power-supply division, had previously supplied power-supply modules for semiconductor equipment to Lam Research. Equipment made by Lam Research with those modules installed was also reportedly used on Samsung Electronics Co., Ltd.'s semiconductor production lines. Industry sources believe Lam Research had been considering bringing the technology for key components in-house. Comet, a power-supply maker for plasma control, had considered an acquisition in the past and has entered the bidding again this time.
Meanwhile, the Engineering Mutual Aid Association is Dawon Powertron's largest shareholder, with a 46.7% stake, and Dawonsys is the second-largest shareholder, with 45.3%. The HB Youth Future Investment Association and individuals, including executives, hold 1 million common shares (4.67%) and 700,000 common shares (3.27%), respectively. The Engineering Mutual Aid Association lent Dawonsys 100 billion won around September last year and secured a stake by exercising its collateral rights. The association, which faces potential losses after guaranteeing obligations worth in the trillion-won range for Dawonsys, is also expected to transfer its stake.
“Since Dawonsys went public in 2010, it has invested in research and development in the semiconductor power-supply sector for about 15 years and built up related technology,” an investment banking industry source said. “It is significant that domestic capital has protected core technologies developed in Korea, along with the rights to manage and use the patents.”

[email protected] Kang Gu-gwi Reporter