Korea Post seeks global distressed debt fund managers

The organisation’s savings and insurance arms will jointly commit up to $200m to the strategy.

Korea Post is seeking two global distressed debt fund managers this month, according to a request for proposals. The prospective commitment size is up to $100 million apiece. The capital comes from Korea Post’s savings fund and insurance fund.

The investor is seeking managers with proven investment performance in distressed commingled funds, including  both pre- and post-GFC. Korea Post will exclude hedge funds and special situation-focused funds, although distressed debt funds with a partial allocation to special situations will be considered.

Korea Post requires foreign managers to submit proposals via registered local fund distributors which have already entered into an exclusive distribution agreement with the managers for respective funds. Interested parties are asked to either mail their applications to the savings fund’s alternative investment team or submit them in person by 28 February.

The investor is targeting a minimum eight percent hurdle rate and up to 20 percent carried interest. It is also offering a two percent management fee based on either total committed capital or invested capital.

Requests for further comments to Korea Post’s investment officers were not returned.

As PDI data show, Korea Post’s manager roster currently includes Goldman Sachs Merchant Banking Division, Partners Group, Park Square Capital, and Guggenheim Investments. Its typical fund commitment size is $100 million per ticket.

Korea Post has been investing in offshore private markets since 2014. It is overseen by the Ministry of Science and Information and Communication Technology of Korea. In January, its insurance arm sought managers for a $300 million energy infrastructure mandate, as sister publication Infrastructure Investor reported. Korea Post’s savings fund managed more than $11.9 billion in assets, as of end-2018.

Last week, Korea Post entered into a memorandum of understanding with Korea Investment Corporation, the sovereign wealth fund, according to a KIC statement on 21 February.

“Both parties plan to discuss further details on co-investments and asset management within H1 2019,” the spokesman said in the statement. KIC will undertake some offshore asset management activities on behalf of Korea Post although the expected timeline was not disclosed.