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Infrastructure investment

Ardian wins $25 mn mandate from construction workers' fund

Ardian says its first hydrogen infrastructure investment fund already raises over $900 mn

Oct 01, 2021 (Gmt+09:00)

(Source: Getty Images Bank)
(Source: Getty Images Bank)

South Korea’s Construction Workers Mutual Aid Association (CWMA) will commit $25 million to Paris-based private equity firm Ardian for infrastructure investments, according to a local media report.

The $4 billion savings fund for Korean construction workers has awarded its infrastructure investment mandate to Ardia's secondary fund of funds, which targets an internal rate of return (IRR) of 12-15%, the Financial News reported on Thursday.

Separately, Ardian on Friday announced the launch of its new fund, Hy24, which it said is the world's largest hydrogen infrastructure investment platform. 

In a press release, the French PE firm specified South Korea's petrochemical company Lotte Chemical Corp. as an anchor investor of the new fund, without elaborating further. 

Ardian is setting up the fund with FiveT Hydrogen, a hydrogen-focused PE firm, and their joint fund has already secured €800 million ($926 million) in commitments from strategic and financial investors, including the French insurer AXA. It targets €1.5 billion ($1.7 billion).

It has not yet been confirmed whether the $25 million commitment from CWMA is being funneled into the new investment vehicle focused on hydrogen-related and decarbonization projects.

Lotte Chemical said in a regulatory filing last week that it was investing 49.5 billion won ($42 million) in a 50-billion-won environmental, social and governance (ESG) investment fund managed by Lotte Accelerator Corp. between Sept. 27-28. The venture capital firm is committing the remaining 500 million won to the ESG fund.

ARDIAN'S FUNDRAISING IN KOREA BETWEEN 2020 AND EARLY 2021

Ardian last year raised a record $19 billion for its new secondary fund of funds from about 300 investors. Korea Post’s savings arm and the Public Officials Benefit Association committed $100 million and $50 million each to the secondary investment platform, which acquires stakes in private equity and infrastructure funds.

Earlier this year, Ardian received a combined $105 million infrastructure mandate from South Korea's Government Employees Pension Service, together with Goldman Sachs and Macquarie.

Ardian manages $114 billion in assets, of which infrastructure makes up $22 billion. Its fund of funds platform covers both primary and secondary funds of funds.

EIG GLOBAL ENERGY

Last year, US-based EIG Global Energy Partners secured a $25 million mandate from the Korean construction workers' fund for infrastructure investments, targeting 6-8% of IRR, the newspaper added.

EIG Global in 2020 raised $1.1 billion in a special direct lending fund that invests across the energy industry, including midstream, power and renewable energy companies, as well as infrastructure facilities.

CWMA puts its investment priority on securing stable income and alternatives account for one-quarter of its assets of $4 billion.

(Updated throughout with Ardian's statement on the launch of its first hydrogen infrastructure investment platform and Lotte Chemical's disclosure)

insight@hankyung.com

Yeonhee Kim edited this article.

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