Partners Group wins $620 mn Korean LPs mandate for infra

Some major institutional investors of South Korea have committed a combined $620 million to Partners Group’s third direct infrastructure program, which closed at $8.5 billion in February, sources familiar with the matter told The Korea Economic Daily. 

The program is anchored by Partners Group Direct Infrastructure 2020, which has raised $6.4 billion and includes another $2.1 billion committed via the firm’s other private market programs.  The program targets 14-17% gross internal rate of return.

The nine Korean investors are pension funds, mutual aids, banks and insurers including KB Kookmin Bank, Hyundai Marine & Fire Insurance Co. and DB Insurance Co., The Korea Economic Daily understood.    

“Korean LPs have ramped up their infrastructure assets as the asset class generates steady streams of sales and cash flow in volatile markets,” a source said. Partners Group’s core plus strategies and portfolios with diverse mid-cap infrastructure assets attracted Korean LPs that expect value creation amid market uncertainty, the source added.

Through the third direct infrastructure fund, the asset manager invested in some global companies in 2021 focusing on telecommunication and energy. Partners Group stated the investee firms include EOLO, Italy's wireless access broadband provider; Gren, a district heating platform in the Baltics; Unity Digital, a telecommunications infrastructure platform in the Philippines; and Dimension Renewable Energy, a US energy platform focusing on solar and battery storage, and others.

The remainder of the investment program will target sectors of digitization & automation, decarbonization & sustainability and new living, such as healthcare and heating & ventilation systems, the asset manager said.

Korea’s key asset owners have participated in Partners Group’s other funds. Last year, the country’s postal service agency Korea Post made a $100 million commitment to the asset managers’ seventh flagship secondary fund targeting $4 billion. Another four Korean investors, including KB Insurance Co. and Hana Financial Investment Co., participated in the secondary fund with a combined $150 million commitment. The fund aims to close in May of this year.

In 2017, Korea's Public Officials Benefit Association (POBA) invested €40 million in the investment firm's second direct infrastructure fund, Partners Group Direct Infrastructure 2015, which closed at $2.5 billion in the same year. The firm has completed capital deployment via the fund and posted 14-15% gross internal rate of return, The Korea Economic Daily understood.

Headquartered in Switzerland, Partners Group manages $127 billion in assets. It has invested more than $170 billion in global private equity, real estate, debt and infrastructure since its foundation in 1996.

Write to Jihyun Kim at snowy@hankyung.com
Jennifer Nicholson-Breen edited this article.