Korean teachers' fund pockets sweet returns from US cloud-based platform

The Korean Teachers' Credit Union (KTCU) has secured returns nearly four times its $37.6 million investment in the US cloud-based platform provider Ellie Mae in just one and a half years after a US private equity firm exited the startup, according to the investment banking industry on Oct. 12.

The South Korean teachers' fund pocketed $153.8 million from the divestment, achieving a 167% internal rate of return when the global securities exchange operator Intercontinental Exchange (ICE) acquired Ellie Mae from Thoma Bravo for $11 billion.

In 2019, the tech-focused PE firm acquired Ellie Mae for $3.7 billion in which the KTCU invested a total of $37.6 million, including part of its $100 million commitment to the No.13 blind fund managed by Thoma Bravo in July 2018.

Founded in 1997, Ellie Mae is a cloud-based platform provider for the mortgage finance industry. ICE's acquisition of Ellie Mae is part of the exchange operator's move to boost its presence in the mortgage tech space through active M&As.

ICE, owner of the New York Stock Exchange, acquired Mortgage Electronic Registrations Systems (MERS) in 2016 and the mortgage tech firm Simplifile in 2019 in a move to digitalize the mortgage process.

KTCU is a savings association with 33 trillion won in assets under management as of the end of 2019.

In September, the KTCU said it would invest 100 billion won ($85 million) in a pre-completed logistics center leased to Amazon.com in Delaware, US for an expected annual return of around 8%.

Write to Junho Cha at chacha@hankyung.com
Danbee Lee edited this article.