International private equity firms are increasing their presence in South Korea, with overseas investors accounting for more than 80% of buyouts valued above KRW500bn ($370m) so far in 2026, compared with around 60% last year, according to a report by the Financial Times citing data from Dealogic.
The shift is positioning Asia’s fourth-largest economy as an increasingly important destination for global buyout funds seeking opportunities beyond Japan, while geopolitical tensions encourage some investors to diversify away from China.
South Korea offers several drivers of private equity activity, including corporate divestments, governance reforms and succession challenges among ageing business founders. High inheritance taxes are also prompting some family-owned companies to consider selling rather than transferring ownership to the next generation.
Recent transactions include TPG’s acquisition of Lotte Group’s car rental business as part of the conglomerate’s restructuring, while KKR has invested in renewable energy assets previously owned by SK Group.
Buyout deal value in South Korea reached $7.8bn in the first nine months of 2026, up approximately 3% year-on-year. Although Japan continues to attract the largest share of private equity investment in Asia, investors are increasingly viewing South Korea as a source of larger transactions and opportunities to expand businesses internationally.
The domestic market faces challenges, however, following heightened scrutiny of local private equity firms after supermarket operator Homeplus entered debt restructuring. Regulatory investigations and a pause in commitments to domestic managers by South Korea’s National Pension Service could create further opportunities for international investors.
