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Riverside makes first Korean acquisition

The Cleveland, Ohio-headquartered firm has acquired a Korean preschool operator, its second deal in Asia, and its 20th in 2008.

The Riverside Company, a US-based global mid-market investor, has acquired Wiz Korea, a preschool education franchise in Korea for an undisclosed sum. The acquisition is Riverside’s 20th deal of the year, but its first in Korea.

Based in Bundang, Wiz Korea operates 56 preschool facilities through 53 franchises and three company-owned branches. Four of its franchises are located overseas. The school focuses on students aged between two and seven.

Stuart Baxter, a managing partner at Riverside, said in a statement that education and franchising are among industry segments where the firm has developed considerable experience and knowledge. The firm has acquired four franchising firms and 10 education and training firms, he added.

The investment was made out of Riverside Asia Fund I, and is the firm’s second deal in Asia, following the acquisition of Shinsouki, a parking lot operator in Japan in January earlier this year.

Riverside opened its first Asian offices in Tokyo and Seoul last year.

Stuart Kohl, co-chief executive of Riverside, told PEO at the time of the Shinsouki deal that in Asia, the firm is interested in making investments in Korea, Japan, Australia and Singapore. “We liked the fact that these markets are large and well established, that they have good banking systems and they are stable democracies with rule of law,” he said.

Separately, the firm is set to start fundraising for its fourth European fund in the last quarter of 2008. The firm is targeting at least €650 million ($968 million) for Europe Fund IV, though a final figure has not been formally agreed upon.

Riverside focuses on investments in companies in the smaller end of the middle market. It has invested $3.4 billion (€2.3 billion) in 196 deals so far, and currently has a portfolio of 65 companies in Asia, Europe and the US. The firm manages more than $2 billion across nine funds.

MVP Partners advised Riverside on the transaction.