Brain Asset Management and KY Private Equity’s Acquisition of Preferred Shares of SK Pharmteco

On October 20, 2023, Lee & Ko successfully represented Brain Asset Management Co., Ltd. and KY Private Equity Co., Ltd. in their acquisition of approximately 9.21% of the preferred shares of SK Pharmteco Inc., originally a wholly-owned subsidiary of SK Inc. prior to the acquisition, based in Delaware, USA (the “Target”) through (i) Opus 1st Inc., a special purpose company established by an institutional PEF with Brain Asset Management and Korea Development Bank as its general partners, (ii) Brain SP Generalized Private Investment Trust No. 45 and Brain SP Generalized Private Investment Trust No. 46, each an investment trust established and managed by Brain Asset Management, and (iii) Opus 4th Inc., a special purpose company established by institutional PEFs with KY Private Equity as their general partner ((i) through (iii) collectively, the “Investors”) (collectively, this “Transaction”). 

This Transaction was a pre-IPO transaction in anticipation of a public listing of the Target shares on the Nasdaq market, and aside from the high deal value of USD 300,210,071 as the aggregate purchase price, the deal structure itself was quite complicated as it involved issues such as the establishment of multiple investment trusts and special purpose companies as investment vehicles. This Transaction also involved the execution of a shareholders agreement to coordinate the commercial understandings between the Investors and SK Inc., the original shareholder, and there were further complex issues to be resolved in light of the regulations and procedures under the Financial Investment Services and Capital Markets Act, the Monopoly Regulations and Fair Trade Act and the Foreign Exchange Transactions Act, as well as tax issues both in and out of Korea and antitrust filing issues in the US and EU. Despite these complexities, Lee & Ko was able to provide effective advice to reach a successful consummation of this Transaction within a short period of time. Lee & Ko was involved in the Transaction and served as transaction counsel in all aspects of this Transaction, from the selection of preferred bidders at the auction stage through the review of transaction structure, establishment of PEFs and special purpose companies, foreign exchange report filings, tax review, antitrust filing review, preparation/negotiation of the share subscription agreement and shareholders agreement, execution and closing.