Korea Post to commit $150 mn to mid-cap infrastructure funds

Korea Post will commit $150 million to one or two global asset managers for mid-cap infrastructure equity investments, the postal service agency said on Friday.

Proposals for the mandate are due by June 12, with the selection to be finalized in August.

“For portfolio diversification, we decided to invest in mid-cap funds this year,” said a Korea Post official. “No decision has been made on any additional commitment (to global infrastructure funds) this year.”

Qualified asset managers must have more than 10 years of experience in infrastructure investments and a track record in managing mid-cap infrastructure funds, as well as at least $10 billion in infrastructure assets under management.

The asset manager selected must raise an infrastructure equity fund of $2 billion-$7 billion, including Korea Post’s commitment, with a maturity of 15 years.

Managers are required to employ core plus and value-add strategies, targeting developed markets such as North America and Europe.

The investment period is capped at six years. Carried interest is set at up to 20% of capital gains exceeding a hurdle rate of an 8% net internal rate of return.

Write to Gyeong-Jin Min at min@hankyung.com

Yeonhee Kim edited this article.