South Korea’s buyout fund VIG Partners announced that it had entered into a definitive agreement to acquire an 85% stake in Teazen Inc, a tea-based health drinks company known for “Tae-ri Kim Kombucha”.
VIG said it will acquire the entire 70% stake from IBK-TS Private Equity Fund, the previous major shareholder, and an additional 15% from the 30% stake held by CEO Jong-tae Kim and related parties.
The transaction amount is approximately $70 million and the closing is expected to take place during May.
Established in March 2000, the Company has expanded its product portfolio from traditional tea products to various tea-based health drinks.
Teazen has secured best quality raw materials by directly operating an organic tea farm with a scale of 200,000m 2 in Haenam, Jeollanam-do, and manufactures finished products at a manufacturing plant in Yongin, Gyeonggi-do.
The Company offers not only traditional tea products such as pu’er tea, green tea, black tea, and herbal tea, but also various tea-based health drinks such as organic barley sprout powder, grapefruit green tea, energy
tea, and teas for better sleep.
In particular, Teazen succeeded in commercializing the powder-type kombucha products utilizing freeze drying technology in 2019 for the first time in the world, recording $34 million in sales last year achieving 100% YoY growth rate compared to $17 million in 2020.
Kombucha is a probiotic drink with sweet and sour taste made by adding beneficial bacteria to fermented
green tea or black tea. It has unique characteristics, such as low calorie, containing live lactic acid bacteria
and refreshing flavor due to the carbonic acid produced during fermentation.
As a result, the demand of kombucha has exploded around the world and become a household name for functional beverages, especially after American celebrities started drinking in the early 2010s.
After the closing, VIG plans to recruit professional management and actively expand customer reach. This investment marks the sixth investment from VIG Partners Fund IV, which closed in late 2019 at $850 million, following the investment of $25 million in FASSTO (closed in last April), a fulfillment service provider, which is an official member of Naver’s Smartstore.