Korea Post Insurance to allocate $200m to global buyout funds

The group - which accounts for KRW54 trillion ($50 billion) of the approximately KRW124 trillion Korea Post has in postal savings and insurance assets - has asked for proposals from private equity firms interested in participating. To qualify, firms must have primarily been involved in control deals since 2000.

Korea Post is willing to invest $120 million in up to two funds in the middle market space with a corpus no larger than $4 billion and then $80 million to one upper middle market manager that has a fund of $4 billion or more. Funds with a more than 50% allocation to Asia and emerging markets will not be considered.

According to a disclosure, Korea Post is looking for an IRR of at least 7% and a multiple of 1.25x. It will pay a maximum of 2% in management fees and 20% in carried interest, subject to the fund reaching its hurdle rate.

Korean institutional investors are increasing their exposure to alternative assets because low policy interest rates have made fixed income less attractive. The CEO of Korea Post Insurance told an industry conference this week that its alternatives allocation is intended to reach 10% by 2020, up from the current level of 6%.

Earlier this year, Korea Post announced plans to commit $200 million to funds offering global private equity co-investment exposure.

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• Topics
• North Asia
• LPs
• Fundraising
• Buyout
• South Korea
• Korea Post