NPS to buy stake in Australia’s Metrics to expand alternative investments

South Korea’s National Pension Service (NPS), the world’s third-largest pension fund, has agreed to buy a stake in Australian asset manager Metrics Credit Holdings Pty Ltd. to expand its alternative investments.

The NPS and US real estate asset manager Townsend Group agreed to purchase a 4.17% stake in Metrics for A$50 million ($31.6 million), according to a March 13 filing with Australia's Securities Exchange Ltd. by Metric’s shareholder Pinnacle Investment Management Group Ltd.

Under the strategic investment, the NPS and Townsend will also invest in Metrics real estate-focused investment strategies.

“As one of the world’s largest pension funds, NPS, along with Townsend, a leading global real asset investment platform, will assist our future growth plans, both domestically and internationally — particularly in our real estate strategies, an area where Townsend brings considerable expertise," Metrics Managing Partner Andrew Lockhart said in a statement.

Metrics is a non-bank corporate lender and alternative asset manager with A$23 billion in assets under management (AUM).

ALTERNATIVE INVESTMENTS

Through the strategic partnership with Metrics and Townsend, the NPS, Korea’s largest institutional investor, is set to strengthen its cooperation on investments in alternative assets, such as commercial property in Australia.

The state-run pension service, which manages 1,213 trillion won ($838.4 billion) as of the end of 2024, has already made sizeable alternative investments in Australia.

In January, the pension scheme committed A$700 million in equity to a strategic partnership with Australian sector specialist Scape Australia, the country’s leading student housing company.

Earlier, the NPS acquired an office building, Melbourne Quarter Tower, for A$1.2 billion in 2021 and the commercial skyscraper Aurora Place in Sydney for A$685 million in 2010.

The pension service’s alternative investments, which accounted for 17.1% of its total AUM last year, delivered a 17.09% return, the third-best after overseas equities with 34.32% and overseas bonds with 17.14%.

Write to Gyeong-Ji Min at min@hankyung.com
 
Jongwoo Cheon edited this article.