Korea Post unit looks to invest in global secondary funds
Savings Bureau of Korea Post, one of South Korea’s largest state-controlled institutional investors, is looking to invest at least $30 million in a global secondary fund. It represents one of the savings bureau’s first forays into alternative investments and follows a similar move by Korea Post’s insurance bureau, AsianInvestor reported.
The savings and insurance units have assets of $50 billion and $30 billion, respectively, and fall under the regulatory remit of the Ministry of Knowledge Economy.
GPs will only be considered if they have a fund with at least $500 million in assets under management and a target IRR above 8%. The ideal vehicle will have a maturity of 10-12 years and an investment cycle of five years. Korea Post is willing to pay an annual management fee of 2% during the investment period and less than 2% of the invested amount or average outstanding thereafter. The carry should be below 20% unless the fund's IRR exceeds 8%. The deadline for submissions is October 31.
The Korea Post units are the country's most active overseas institutional investors, alongside National Pension Service and Korea Investment Corp. (KIC).
Choi Chong-suk, making his inauguration speech as CEO of KIC in July, pledged to boost exposure to alternative investments such as private equity and commodities. He added that the $46 billion fund would continue to actively invest overseas, potentially partnering on deals with other sovereign wealth funds, and would seek to strengthen ties with foreign private equity and pension funds.
KIC, which was founded in 2005, is still predominantly exposed to debt and equity capital markets, and is keen to diversify its investments from US dollar-backed assets.
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