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Korea’s NPS adds three alternative managers to line-up, report says

South Korea
By Hui Ching-hoo   
November 30, 2020

South Korea’s National Pension Service (NPS), the world’s third largest pension fund, has expanded the line-up of managers to oversee its foreign alternative investments to 159 with the inclusion of two US and one Australian firm, according to a local news report.

The new additions are KKR & Co and Madison Capital of the US, and Sydney-based Scape Australia Management, The Korea Economic Daily says in a report on November 27.

Quoting from a Korean language third-quarter alternative investment report issued by the NPS, it says 62 managers in the line-up are for private equity mandates, seven for hedge fund investments, 54 for real estate strategies, and 36 for infrastructure.

It says KKR and Scape Australia will manage real estate investments, and Madison Capital is for private equity.

It says the NPS invested US$300 million in a fund focused on student housing facilities that’s managed by Scape Australia in August.

It’s not clear whether the asset managers were hired for previously announced mandates, or whether they were added to a pool of managers for specific asset classes who can bid for tenders.

Spokespersons for the NPS did not immediately respond to questions from Asia Asset Management.

According to the report, the NPS raised its alternative investment allocation by 7 trillion won ($6.34 billion) between January and August, to about 91.7 trillion won. Around 70% of assets in its alternatives portfolio is invested overseas.

It says the pension fund plans to invest another 8.3 trillion won in alternative assets by December 31.

Jeonju-based NPS had 789.9 trillion won of total assets as of August 2020.