financial advisory service group - · pdf filegrowth due to stabilized organizational...

An Independent member of Baker Tilly International An Independent member of Baker Tilly International

Financial Advisory Service Group

An Independent member of Baker Tilly International

Introduction

The history of Baker Tilly Sungto LLC (“Sungto” or “the Company”) was established in 2000, retaining 50 of the most experienced professionals from the former firm KPMG Busan. Since its inception, Sungto has continued steady growth due to stabilized organizational structure, changes in Korean economic environment, coupled with localization and globalization of economy. Since 2000, revenue has grown annually at an average of 25%.

In 2003 Baker Tilly Sungto became a member of Baker Tilly International, a network of high quality, independent accountancy and business service firms. As a member firm, Sungto is subject to the highest professional standards and quality control reviews. Cooperation with other firms, combined with the first hand knowledge of doing business in Korea, enables the firm to quickly analyze, anticipate and respond to international clients’ needs.

Baker Tilly Sungto put its best practices to work to offer outstanding services and aspires to be a leader within its market segment in Korea. Sungto has been proactive and gained high reputation in various business areas such as audit, assurance based advisory services, due diligence, management consulting and tax consulting services.

Sungto’s Financial Advisory Service Group(“FAS”) is organized by function to cope with the globalization, and dramatically changing business environment in such areas as business mergers and acquisitions, corporate restructuring and work outs, risk management and overseas investment.

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CONTENTS

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Contents Contents

I. Company Overview

1. About Us ………………………………………………………. 3

2. Key Members in FAS……………………………………… 4

1. M&A Advisory………………………………………………. 6

2. Financial Due Diligence………………………………… 8

3. Valuation……………………………………………………….. 9

4. Corporate Finance………..………………........................ 10

5. Business Recovery………..………………………………… 11

II . Major Service Area

Ⅲ. Deliverables

• Deliverables ………………………………………………………. 12


1. About Us

3

Relocated headoffice to Seoul

START

Name changed to Baker Tilly Sungto

Received Presidential

Citation

Established Sungto Accounting Firm

Joined member firm of Baker Tilly

International

Opened Daegu Office

2000 2003 2009

2002 2005 2012

2014

• CEO: John G.S. Park • Professionals: 133 • HQ Address: 10F, Samwon Tower, 124 Teheran-ro, Gangnam-gu, Seoul • Office Locations: Seoul, Busan, Changwon, Daegu

Our History

Registered in PCAOB of America

Opened Changwon Office

I. Company Overview

Brief

An Independent member of Baker Tilly International 4

John G.S. Park, CEO E. [email protected] T. +82 2 513 0243

• Managing Partner, Baker Tilly Sungto LLC. (Financial Advisory Services) • KICPA, Member of Korean Institute of Certified

Public Accountants • Member of EUCCK • B.A. and MBA from Busan National University

Mr. Park, as a member of KICPA, has more than 30 years experience in various engagements in connection with international clients. He also worked for KPMG New York Office as an international transferee. John has involved in various range of professional services for international companies in the region including automotive, shipbuilding and transportation industry. Recently he has led outsourcing engagements such as the incorporation of a legal entity, monthly bookkeeping, payroll, treasury, tax compliance, financial reporting under USGAAP and IFRS for overseas parent companies and liquidation. Additionally, he has undertaken mock tax reviews, assistance during tax audits and tax appeal processes for international companies.

M&A Advisory Service: • Selling-side advisor for Jinse Shipbuilding • Selling-side advisor for Metal Chemical • Selling-side advisor for Daenam Hospital • Buying-side M&A advisor for KSP Haeduk Powerway

Transaction Service • Financial Due Diligence of Sea-plus for Value Design • Financial Due Diligence of Samsung Fine Chemical for Sigma Coatings • Financial Due Diligence of Chokwang Jotun for Jotun

Valuation Service • Sejong Co. Ltd. • Taekwang SCT and many listed&unlisted companies

I. Company Overview

2. Key Members in FAS


Min Jae Lee, Partner E. [email protected] T. +82 2 513 0208

• Partner, Baker Tilly Sungto LLC. (Assurance and transaction services) • Executive Consultant, KOTRA • KICPA and AICPA • Member of EUCCK • BA from University of Sungkyunkwan and MBA

from KDI School

Mr. Lee is a Partner in the International Business Service Department, with over 25 years of audit and tax experiences serving a diverse range of public and private multinational and domestic clients. Prior to joining Baker Tilly Sungto in 2006, Min Jae spent 16 years with a big4 accounting firm as well as a government agency, which included an international secondment in the areas of audit and assurance. His international experience includes an 18 month assignment in Chicago, USA. Min Jae’s specialty is helping transnational companies to establishing their subsidiaries in Korea, maintaining day-to-day bookkeeping, preparing and reporting financial statements to parent companies, filing tax returns as well as rendering confidential payroll services. Currently, his clients come from the US, the UK, France, Germany, Italy, Spain, Singapore, Hong Kong, China and Japan. He has also managed a number of cross-border acquisitions: • KEPCO’s acquisition of Bylong mine in Australia • Motorola’s successful acquisitions of three Korean CDMA mobile phone

manufacturers • Philips’s acquisition of a LCD division from LG Electronics • HSBC Private Equity Management’s strategic investment in a Korean

photomask maker • Due diligence of Beni-Suef Cement Company for possible acquisition by

Daewoo Group • Daewoo Group’s M&A acquisition of a Pakistani Electric Company.

I. Company Overview



Seung Kyu Choi, Partner [email protected] T. +82 2 513 0214

• Partner, Baker Tilly Sungto LLC. (IT Consulting Service & External Audit) • KICPA • Certified Information System Auditor (CISA) in USA • Earned Ph. D.(MIS), Kyung Hee University • MBA and bachelor’s degree in Konkuk University

Seung Kyu has a volume of experiences in ERP and SEM related consulting projects in Manufacture, Telecommunication & Airport industry as well as audit experiences and internal control projects. He has work experiences in PwC Seihwa Accounting Firm, Deloite Ahnkwon Accounting Firm, Dacom System Technologies, and 2e information Technology, and has expertise in the following field: ERP ans SEM system consulting Auditor Internal control & Risk management Accounting & Managerial Accounting consulting service Major project experiences: SOX project (over 40 companies) ERP system implementation and review (IIAC, Dacom, Glovis, KOID, Chonbuk University Hospitality etc. ) ABC system design (Chonbuk University Hospitality, Konkuk University Hospitality) External Audit (over 100 companies) Other IT consulting His lecture experiences: Konkuk University, Kukmin University, Korea Tech and Education University, IBM Korea, KOSDAQ Association etc..

I. Company Overview



Chul Jun Lim, Partner [email protected] T. +82 51 460 4703

• Partner, Baker Tilly Sungto LLC. (Financial Advisory Services) • KICPA • Completed a specialist program for real estate

development in Myongji University • BA from Busan National University, majored in

Accounting

Prior to joining Sungto, Chul Jun worked for Deloitte Ahnkwon accounting and KPMG Samjung accounting firm. He is currently a Partner specialized in FAS division, Baker Tilly Sungto. He completed a specialist program for real estate development in Myongji University, and he spent 4 months in Baker Tilly China for the international secondment program. Chul Jun has expertise in consulting for rehabilitation and corporate restructuring, and the buying and selling side for M&A. In particular, he has wide experiences of an advisory service for getting Chinese corporates listed on the KOSDAQ and establishing Korea office. For professional activities, he is currently taking the positions below. Senior investment commissioner for the rehabilitation program in Busan and Gyungnam areas. Member of real estate valuation and evaluation for normalization of management, KAMCO.

I. Company Overview



1. M&A Advisory Service

According to the current statistics, a corporate business can last only for thirty to forty years at average. There are not a few M&A attempts to practice the strategy to achieve business growth, but unfortunately there are not that many successful cases in reality. ‘M&A’ is a compound word of ‘Merge’ and ‘Acquisition’ and detailed process is as following.

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Strategy Planning

and Marketing

II. Major Service Area

M&A Process

Selling-side Due Diligence

Investor Tapping

IL Forwarding,

CA Application

Investment Prospectus

Intent of Letter Application&

Acquirer’s Prep Due Diligence

Designation of

Preferential Negotiator

MOU Buying-side Due Diligence

Post M&A


Sungto provides one stop services from M&A strategic planning to post M&A in order to achieve successful M&A based on various experiences and its own expertise.

Advisory

• Law Firm • Accounting

Firm

M&A Interested Parties

Buying-side

• General Corporate

• MBO • EBO • LBO Artists • Raiders • Vulture

fund

Broker Selling-side

• Management • Shareholders • Creditors • Employees

Advisory

• Law Firm • Accounting

Firm

Funding provider

• Commercial Bank

• Insurance Company

• Pension & Funds • PEF • Venture

Capital • LBO Fund

etc.

Investors

• Financial Investors

• Strategic Investors

Research Firm

• Information Collection • Information Analysis • Industry Analysis

Merge

Acquisition

1. M&A Advisory Service(2)



2. Financial Due Diligence


In M&A process, the selling-side submits information about a target company and a potential acquirer goes through the process of verifying the submitted information. ‘Financial Due Diligence’ is the process which the buying-side evaluates and investigates a target company or its assets for a certain time period.

•Evaluating toxic assets, identifying unrecorded liability, and analyzing profitability

1. Review Propriety Of Financial Accounting Information

•Identifying guaranty debt, lawsuit issue, environmental issue, and tax issue

2. Identify Contingent Liability

•Evaluating patent or goodwill

3. Evaluate Intangible Assets

•Identifying the size of additional investment by reviewing future business plan and

investment schedule(Capex)

4. Identifying Additional Investment Scale

•Reviewing financing, debt redemption, and cash flow for operation

5. Review Cash Flow

•Identifying employees’ attitude, relationship with employees, and tendency of labor

union

6. Understand Employees

•Identifying core manpower, strength and weakness, and reviewing management

direction after acquisition

7. Prepare For Follow-up Management

Sungto provides due diligence consulting service to review the suitability of acquiring purpose and to prepare management strategies for the after acquisition.


3. Valuation


Valuation process requires professional evaluation skills as strategic valuation is an issue of growing importance for maximizing the enterprise value.

•Analyzing appropriate price and evaluating value for both buying and selling-side

parties in M&A process

1. M&A Related Valuation

•Supporting decision making by reviewing business value for business development,

real estate development business, and equipment investment.

2. Review of Business Value Related Valuation

•Evaluating merger, merger division, stock exchange, investment in kind price, which

required in capital market act.

3. Regulations Related Valuation

•Evaluating the fair value of assets and examining assets impairment, which required in

IFRS.

4. Financial Report Related Valuation

•Dividing proportionally stock acquisition value with intangible assets value and

goodwill or negative goodwill.

5. PPA Related Valuation

Sungto provides services with methodologies and techniques adequate for the purpose based on various understandings of the industry.


4. Corporate Finance


It is essential to ask for the assistance from financial advisors in corporate’s financing process. Sungto provides many plans to maximize the company value stage by stage in the financing process.

•Analyzing business value and establishing financial strategy

1. Business Planning

•Forecasting the scale and the uses of financing by analysis of the cash flow.

2. Projection on Capital Requirements

•Deciding on borrowed capital vs. equity capital

3. Decision on Optimal Capital Structure

•Deciding on public offering vs private placement

4. Selection of Financing Plan

5. Prepare Information Memorandum(IM)

•Establishing marketing strategy for financing

6. Financing

•Managing the fund raised for investment

7. Follow-up Management

In order to leverage financing from capital market through IPO, Sungto provides IPO strategy planning service including the review of overall listing requirements. Besides, Sungto provides services supporting the financing from overhead capital market through strategic or financial investors.


5. Business Recovery


Sungto provides a range of services regarding corporate restructuring : diagnosis of company that is symptomatic of insolvency, debt settlement for business normalization, withdrawal of bonds and layoff of company in creditors’ position, due diligence and submission of the report for a company that is in the rehabilitation program.

• Providing advisory service about rehabilitation program and reviewing the possibility of success. • Serving as a substitute for rehabilitation application through professional accountants and partnered

lawyers • Serving as a substitute for application regarding disposition of assets and comprehensive injunction • Providing legal and financial advisory service during the rehabilitation process • Deputizing to prepare the report submitted to the court • Dealing with investigation and advise on assessing financial and debt status • Deputizing to prepare rehabilitation plan • Planning logics for negotiations with creditors • Providing advisory services on M&A support and rehabilitation exit.

1. Consulting For Corporate/Personal rehabilitation Application And Its Process

2. Advisory Services for Corporate Restructuring

• Establishing exit strategies for composition and receivership • Preparing IM and evaluating business value • Estimating investment scale and attracting investors • Disposing of business and attracting foreign capital

3. Bankruptcy and Liquidation

• Assessing and securing assets for business performance and withdrawal of bonds on behalf of creditors • Dealing with business for a target company according to the disposition of assets • Dealing with business for the bankrupt company • Conducting a due diligence for a target company with advisory services • Conducting a due diligence for a target company as an investigation commissioner. • Assisting in application for the rehabilitation program


Deliverables

II. Deliverables

- Proposed transaction background

- Business overview - Key findings - Quality of historical earnings

2. Financing Performance

3. Financial Position

4. Tax Compliance & Tax Related Contingent Liabilities

Analysis on working capital and projections would be included depending on the work scope

5. Others

Our Reports Includes

1. Executive Summary

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Seoul 10F, Samwon Tower, 124 Teheran-ro, Gangnam-gu,Seoul T : +82 (0)2 517 8333 F : +82 (0)2 517 8399 Busan 5F, Sungdo Bldg., 7 Jungang-daero 320 beon-gil, Dong-Gu, Busan T : +82 (0)51 463 7222 F : +82 (0)51 462 6229 Changwon #T201, 320 Woni-daero, Uichang-gu, Changwon, Gyeongsangnam-do T : +82 (0)55 266 5511 F : +82 (0)55 266 5514 Daegu 9F, Suhyup G-Tower, 2348 Dalgubeol-daero, Suseong-gu, Daegu T : +82 (0)53 754 6100 F : +82 (0)53 754 6105

www.sungto.co.kr [email protected]

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