KTCU, Mirae Asset to invest $143 mn in debt on Blackstone's power plant: report

The Korean Teachers’ Credit Union (KTCU) and three units of Mirae Asset Financial Group will invest a combined 160 billion won ($143 million) in senior debts on a gas-fired power plant in Texas owned by the Blackstone Group, according to a local media report.

They will make the investment via a Blackstone fund which plans to raise about 800 billion won ($716 million) globally for the 526MW Frontera Export power plant in Texas, which sells its whole power generation to Mexico, edialy said on July 30, citing investment banking sources.

The fund, scheduled to be closed in August, is expected to generate an annualized IRR of 6.4% in dollar terms over the next seven years.

KTCU and three unidentified Mirae Asset units will put 80 billion each into the fund.

It will mark the first investment by KTCU, a $23 billion retirement fund, in a cross-border infrastructure facility via a Blackstone fund. Its previous investments through Blackstone funds had been focused on real estate.

In 2016, Blackstone and Fisterra Energy, a majority owned by Blackstone, began exporting power generation from Texas to Mexico from its Frontera facility. It was the first power plant in history to export power on a dedicated basis from the United States to Mexico.

“We are increasing the share of infrastructure in our investment portfolio because they produce stable returns compared with commercial real estate and other property investments,” an unnamed KTCU source was quoted as saying.