LocknLock Pays 180 Billion Won Dividend After Delisting... Affinity Accelerates Exit

Announced No Dividend at Delisting, Large-Scale Dividend Paid Just One Year Later
Total of 264.8 Billion Won Recovered Through Dividends to SPCs and Paid Capital Reduction
Asset Sales, Overseas Business Restructuring, and Shift to Outsourced Pro

LocknLock paid a dividend of 180 billion won after being delisted at the end of 2024. Since global private equity firm Affinity Equity Partners acquired LocknLock in 2017, the firm appears to be accelerating its exit strategy through large-scale dividends and asset sales.

According to the financial investment industry on April 17, LocknLock paid a total dividend of 180.2 billion won last year. The company paid 125.5 billion won to Consumer Strength Limited and 54.7 billion won to Consumer Advantage Limited, the two special purpose companies (SPCs) established by Affinity for the acquisition of LocknLock.

LocknLock had previously announced that it would not pay dividends during the tender offer process in 2024, but carried out a large-scale dividend just one year after being delisted. This is the first major dividend in three years since the exceptional dividend of 83 billion won in 2022. After the dividend payment, LocknLock's retained earnings stood at 334.9 billion won at the end of last year.

Alongside this, LocknLock also carried out a paid capital reduction last year, retiring 18,799,998 shares. The redemption amount for the capital reduction was about 84.6 billion won. Including the dividends, this means a total of 264.8 billion won in cash was returned.

Previously, LocknLock attempted a tender offer to meet the 95% shareholding requirement for delisting, but upon failing to secure sufficient shares, it opted for a comprehensive share swap. LocknLock was then delisted after being incorporated as a wholly owned subsidiary of Consumer Phoenix. Affinity Equity Partners originally acquired a 63.56% stake in LocknLock for 629.3 billion won in 2017.

After recording a loss in 2023, LocknLock has accelerated efforts to improve profitability by selling assets and restructuring its overseas business operations. In 2024, the company sold its Anseong plant, divesting all domestic production facilities and shifting to an outsourcing production model.

Some overseas sales subsidiaries have also been liquidated. LocknLock liquidated LocknLock Trading (Shenzhen) Co., Ltd. and Beijing LocknLock Trading Co., Ltd. in January and February of last year, respectively. The two subsidiaries posted operating losses of 3.4 billion won and 1.3 billion won last year. A LocknLock representative explained, "Multiple operating subsidiaries in China led to inefficiencies, so we consolidated them under the Shanghai entity."

The Indian sales subsidiary, "LOCK&LOCK INDIA Trading Private," is also scheduled to be liquidated this year. By country, LocknLock's sales and their respective shares are as follows: South Korea posted the largest sales at 148.5 billion won (32.68%), followed by China with 112.5 billion won (24.75%), Vietnam with 70.5 billion won (15.50%), Thailand with 28 billion won (6.15%), Indonesia with 22.2 billion won (4.88%), the United States with 22.1 billion won (4.86%), and Germany with 11.4 billion won (2.51%).

While LocknLock has sought to move beyond its image as a kitchenware company, including by acquiring small appliance firms, all business segments other than its airtight container business remain unprofitable. Last year, LocknLock recorded a consolidated operating profit of 18.1 billion won, a 958% increase from the previous year's 1.7 billion won. Revenue was 454.6 billion won, down 2% year-on-year. By segment, operating profit from the core airtight container business rose 5.4% to 28.6 billion won, but the non-container business and small appliances continued to record operating losses of 3.35 billion won and 1.89 billion won, respectively.

LocknLock stated, "We improved operating profit by streamlining sales channels with a focus on profitability. This year, we plan to maintain this strategy, expand exports, and strengthen sourcing competitiveness to boost brand competitiveness and market share in the global market."

LocknLock is also seeking new opportunities by expanding its business portfolio and launching new house brands. Earlier this month, the company launched the beverageware brand Blissole. Last year, it introduced the premium kitchenware brand DEQUET and the lifestyle brand TACFLOW, targeting consumers aged 25 to 35.

Meanwhile, in March, LocknLock appointed Kim Sangyoung, formerly of Cleantopia, as its new CEO. Kim has been tasked with improving LocknLock's stagnant performance. He is recognized for driving B2B sales growth in large hospitals and hotels as the youngest-ever executive at Doosan Group and as CEO of Cleantopia.

This content was produced with the assistance of AI translation services.