NPS commits $163 mn to Macquarie's sixth Korean buyout fund

Macquarie Asset Management is aiming to close its sixth buyout fund in South Korea at a maximum of 1 trillion won ($775.6 million) by the first half of next year, including a recent commitment from National Pension Service (NPS), the world’s third-largest pension fund managing 975.6 trillion won in assets.

NPS is slated to commit 210 billion won to Macquarie Korea Opportunities Fund (MKOF) VI and about 295 billion won each to IMM Private Equity and Hahn & Co., said sources familiar with the matter earlier this week.

The pension giant said on June 30 it has tapped the three investment firms to manage Korean private equities. NPS has limited its commitment to each fund to up to 35% of the fund’s target size.

The asset management arm of Macquarie Group Ltd. held the first close of the sixth fund last month at 200 billion won, without disclosing the investors’ names. The firm is planning to hold the second close with an additional 400 billion won by the end of August, including the NPS’ commitment.

The investment manager is planning to receive a 200 billion-400 billion won commitment from Korean institutional investors for the third close. Korea Post, the Korean Teachers’ Credit Union (KTCU) and other institutions are expected to make new commitments to local private equity funds later this year, market insiders say.

Macquarie Asset Management also attracted a 160 billion won commitment from NPS in 2021 for the 720 billion won MKOF V, the predecessor fund.

Through the fifth blind pool fund, the firm acquired a 60% stake in the facility management unit of S&I Corp., a building maintenance and management affiliate of LG Group, reportedly at 400 billion won in February of this year. The firm also bought a controlling stake in hydrogen producer Approtium, formerly Deokyang, at 860 billion won by using the fund in December 2021.

A Macquarie-led consortium divested a 36.87% stake in SK Shieldus Co., Korea’s leading security service provider, to Swedish private equity giant EQT Partners AB in February of this year. The consortium, which bought the shares in 2018, sold the assets at 1.8 times the purchase price, according to sources familiar with the situation.

Macquarie Asset Management is forecast to exit from LG CNS later this year as the LG Group’s information tech service arm plans to mark the largest public offering in Korea this year. The firm bought a 35% stake at 951.6 billion won in 2019.  

It also acquired Loca Mobility Corp., Lotte Card Co.’s subsidiary and the second-largest public transportation card operator in Korea, at around 415 billion won in April of this year.

Write to Byeong-Hwa Ryu at hwahwa@hankyung.com

Jihyun Kim edited this article.