Hankook & Company to set up CVC with $11 mn in funding

Hankook & Company Co., the holding company of Hankook Tire & Technology Co., announced Thursday a plan to launch a wholly owned corporate venture capital (CVC) arm this month with an initial investment of 15 billion won ($11 million) to transform into a technology-driven company.   

This will mark the South Korean conglomerate’s first venture capital company since its inception over eight decades ago as the country’s first tire manufacturer.

The holding company plans to foster the CVC, dubbed Hankook & Company Ventures, as the tire and auto parts-making group’s investment arm, tasked with unearthing and nurturing promising startups in artificial intelligence, robotics, aerospace and quantum computing.

The CVC plans to raise its first blind fund worth several hundred billion won to mainly invest in so-called deep tech companies that can create synergy with the Hankook group’s core affiliates.

The latest initiative comes about a month after the holding firm’s Chief Executive Park Jongho unveiled in his exclusive interview with The Korea Economic Daily a plan to set up the CVC to invest in areas such as mobility platforms, precision machines and data center thermal management technology for data centers.

The goal is to diversify the group’s portfolio beyond tires and automotive components, said Park.

CLIMBING KOREA’S CORPORATE LADDER  

The tire-centric conglomerate has actively invested in startups with innovative technologies since transforming into its holding structure in 2021 under the leadership of Chairman Cho Hyun-bum.

Its plan to launch a wholly owned CVC gained momentum after the group became Korea’s 27th-largest conglomerate by assets after completing its acquisition of a controlling stake in the world’s second-largest automotive heat pump system maker, Hanon Systems Corp., earlier this year.

The Hankook group’s assets, including total assets of its affiliates and the entire capital of its financial arms, have ballooned to 27 trillion won from 10 trillion won.

To cement its position as one of Korea’s leading conglomerates, Hankook & Company will leverage the new CVC to enhance its business portfolio and expand into next-generation technology sectors.

The company plans to register the CVC as a legal entity this month and obtain a venture capital license, which allows investments in novel technologies, from the financial authorities.

Hankook & Company Ventures will be headed by Jun Jin-won, former vice president of Seoul-based venture capital firm We Ventures, where he led investments in deep tech startups.

Jun previously spearheaded investments in semiconductor, AI and autonomous driving technologies at Samsung Electronics Co. and Samsung Venture Investment Corp., Samsung Group’s venture capital arm.

Write to Jung-Eun Shin at newyearis@hankyung.com

Sookyung Seo edited this article.