[Exclusive] Praxis Exits Credit Business After Just One Year: "Focus and Selectivity"

Slows business diversification... Credit subsidiary to "go it alone"
Contrasts with IMM, Glenwood and STIC stepping up their credit businesses
Exit challenges, including Bunjang, shift focus to managing existing investments

Praxis Capital, which has grown into a major emerging private equity fund (PEF) manager, is parting ways with its private credit subsidiary just over a year after its launch. The move contrasts with the trend among major private equity firms of spinning off their credit businesses and expanding into new investment areas. It appears that Praxis, which has rapidly scaled up, is shifting its focus from diversifying its business to concentrating on existing investments and exits.

According to investment banking (IB) industry sources on November 13, Praxis Capital recently severed its equity ties with its credit-focused subsidiary, Praxis Credit & Solutions. The move comes about one year and four months after Praxis spun off its existing credit division as an independent company in July 2025. At the time, Praxis established the subsidiary to diversify its investment strategy beyond buyouts, which involve acquiring control of a company, into areas such as mezzanine financing and private lending. The subsidiary was headed by Executive Director Cho Jang-hee, who had been responsible for the credit division at Praxis.

Praxis’s decision to exit the credit business, after several years of rapid growth, runs counter to the recent moves by major private equity firms. IMM Credit & Solutions raised a blind fund of about 950 billion won last year, while Glenwood Credit also established a 600 billion won fund and is actively investing. STIC Investments recently established a credit-focused entity, and VIG Partners is preparing to launch an independent credit business early next year.

As the credit market emerges as a new growth area for major private equity firms, Praxis is instead placing greater emphasis on its existing business. Praxis Credit & Solutions is said to have no notable fundraising or investment track record known to the public since its establishment. Given that it has yet to build a substantial operating base, the two sides may have concluded that severing their equity ties before expanding the business further would be in their mutual interest.

The need to exit existing portfolio investments is also cited as a factor behind the decision. Praxis has been pursuing the sale of its controlling stake in secondhand trading platform Bunjang since early 2026, but the deal has gained little momentum. The company’s valuation has been estimated at about 750 billion won. Although Bunjang’s transaction volume and user numbers are growing, it continues to post operating losses. Competition has also intensified as Karrot expands its business into nationwide parcel delivery transactions. Market observers say these conditions make it difficult for Bunjang to secure a high valuation. Beyond Music, a music intellectual property (IP) investment and management company, also halted its sale process in August 2026 after failing to bridge differences with prospective buyers.

Praxis appears to have concluded that increasing the value of existing assets and building a track record of successful exits are important to securing further commitments from limited partners (LPs). “They likely decided that, for the time being, it would be better to focus on strengthening their existing portfolio rather than launching a new business,” said an executive at a PEF manager. “Competition in the credit sector is also growing increasingly intense, and they may have concluded that there are limits to growing the business independently without support from the parent company.”

Meanwhile, Praxis Credit & Solutions is expected to drop the “Praxis” name and set out on its own. Under the leadership of CEO Cho Jang-hee, it plans to become an independent investment firm covering not only its existing credit investments but also traditional buyout deals.

This content was produced with the assistance of AI translation services.