South Korea's largest apparel giant completely exits its 2-trillion-won paper and packaging business
On December 30, 2025, a major piece of news shook South Korea's capital market: the world's largest clothing OEM giant, Seya Group, is considering liquidating all its stakes in the paper and packaging sectors. This package deal, involving Tailin Packaging, Tailin Paper, and Jeonju Paper, is estimated to be valued at up to 2 trillion KRW (about 10.1 billion USD). This is not only an unprecedented M&A exit in the history of South Korea's paper and packaging industry, but also marks Seya Group's official entry into a new phase of strategic contraction and financial structure optimization after years of aggressive expansion.
Three core assets: "half of the country" of Korea Paper
The three companies packaged and sold this time constitute a complete industrial chain of Korean corrugated paper and industrial packaging.
Tailin Packaging, the "gatekeeper" of downstream distribution. As the absolute leader in the Korean corrugated packaging market, Taelin Packaging has a market share of more than 20%. It is not only the largest carton manufacturer in South Korea, but also the core infrastructure of e-commerce and logistics systems. Its 9 production bases across the country give it the ability to "supply nationwide within 24 hours".
Tailin Paper, the "ballast stone" of midstream base paper. Tailin Paper is the core of the group's vertical integration. It focuses on the production of high-strength corrugated core paper and face paper and is a leader in the industrial paper market in South Korea. Due to the mastery of upstream waste paper recycling and base paper manufacturing technology, it provides a very high cost moat for downstream Tailin packaging.
Papermaking in the whole state, the "giant" of upstream production capacity. Jeonju Paper was once the largest producer of newsprint in South Korea. During Morgan Stanley's tenure for more than ten years, the company completed a thrilling leap from the "sunset industry" (newsprint) to the "sunrise industry" (packaging paper). Currently, 80% of its production capacity has been converted to corrugated paper, with an annual output of up to 1 million tons, and it has an attractive ESG (green energy) subsidiary, Jeonju Power.
Origin: From "cross-border integration" to "high-point cash-out"
The background of this transaction reflects the complex struggle between private equity and industrial capital in South Korea's manufacturing industry.
The ten-year "marathon" was withdrawn. Looking back at 2008, when Morgan Stanley's private equity acquired Jeonju Paper for 810 billion won, it was expected to return quickly. However, the collapse of the newsprint market kept the investment trapped for more than ten years. It was not until May 2024 that Seya Group took it under its wing for about 500 billion won to complete the first phase of integration.
The vertical integration experiment of the Shiya Group. Since joining Tailin in 2020, Shiya Group has tried to replicate its success in the clothing industry - creating a closed loop from "waste paper, papermaking, to carton molding". Through the acquisition of Jeonju in 2024, Seya has actually taken control of the lifeblood of South Korea's packaging industry chain.
Why sell now? The sale plan at the end of 2025 is more due to the overall strategy of the parent company, Shiya Group. In recent years, Seya Group has made frequent moves in diversified expansion, acquiring Ssangyong Construction and American sportswear manufacturer Tegra.
However, losses and high financial costs in some of its non-core businesses prompted management to re-examine resource allocation. By selling the more profitable paper sector at a high point, the group can generate significant cash flow that can be used to further strengthen its position as a global apparel OEM leader or support emerging sectors such as energy.
Although the paper sector maintains stable profitability (Jeonju Paper recorded an EBITDA of KRW 140 billion last year), non-core businesses under the group, such as Ssangyong Construction, have recently underperformed, prompting the group to recover cash flow to optimize its balance sheet. With e-commerce growth stabilizing and raw material fluctuations, the overall valuation of the paper sector is currently at a historical high. If the asking price of KRW 2 trillion can be achieved, SEYA Group would gain substantial capital profits.
Market Impact: Industry Shifts Behind the KRW 2 Trillion Price Tag
If this KRW 2 trillion deal goes through smoothly, the competitive landscape of South Korea's paper industry will be completely reshaped.
Who is the Buyer? Market attention is focused on Hansol Paper. As a veteran in Korea's traditional paper industry, Hansol has long coveted Taelin's channels and Jeonju's production capacity. If the deal is completed, a dominant 'paper industry giant' will emerge. Additionally, cross-sector conglomerates such as KG Group and global sovereign funds seeking ESG targets are also observing. Jeonju Power is particularly attractive; its 15-year renewable energy certificate supply contract not only provides stable annual revenue of about KRW 20 billion but also significantly increases the valuation ceiling of the entire packaged assets under the current 'green credit' environment.
From Morgan Stanley's decade-long persistence, to SEYA Group's large-scale integrations, to the current packaged cash-out valued at KRW 2 trillion, the transition from Jeonju Paper to Taelin Packaging essentially reflects the broader struggle of South Korea's traditional manufacturing sector as it seeks new vitality amid transformative challenges.
If this KRW 2 trillion deal is successfully concluded in early 2026, it will redefine the competitive landscape of Korea's paper and packaging industry. For SEYA Group, it represents a successful 'strategic exit'; for the buyer, the next decade's challenge will be how to continue unlocking the potential of this eco-friendly paper empire on a high-base foundation.