이 기사는 2020년 01월 14일 08:00 thebell 에 표출된 기사입니다.

The state-led fund-of-funds management company Korea Growth Investment (K-Growth) is looking for a general partner (GP) to create a secondary fund that acquires a limited partner (LP)’s stake. Three investment firms are likely to vie for the position.

K-Growth is proceeding with a process to select its GP for the secondary fund which aims to acquire LP’s stake, according to industry sources on January 9. The state-led fund-of-funds management company plans to receive applications by January 15, but potential candidates seem to be unveiled. Candidates for the position include Neoplux, Korea Asset Investment Securities, and Meta Investment & Kclavis (Co-GP). K-Growth will select and announce one of the applicants by the end of February.

In addition to the three investment firms, small and mid-sized private equity (PE) firms considered submitting a proposal, but they walked away early due to the large fund size. Accordingly, three investment firms are vying for the competition and waiting for K-Growth’s announcement.

Industry watchers pick Neoplux as the strongest candidate among the three. Recently, the firm has expanded its venture investments aggressively and turned its eyes to overseas markets. Being a venture capital subsidiary of Doosan Group also limits the firm’s risks.

K-Growth commits a total of 40 billion won to a GP of this project. Of the total, 10 billion will be from a fund formed by K-Growth in cooperation with Industrial Bank of Korea (IBK) and 30 billion won will be from the Growth Ladder Fund. The size of the fund should be more than 80 billion won. The GP needs to raise the remaining amount and close the fund within six months after the GP has been selected.

The GP has to put more than 40 billion won that has been committed by K-Growth to main targets of the investment, including private equity funds which are backed by domestic mid-sized companies (more than 70 percent), Korea Venture Fund, Small and Medium Enterprise Establishment Investment Association, and New Technology Investment Association.

The fund will be operated for ten years and its investment period is four years. Management fees will be 1.8 percent of the fund size per annum during the investment period and 1.8 percent of the investment balance after the investment period. Carried interest will be less than 20 percent of an excess return of internal rate of return (6 percent).

(By reporter Lee Kwang-ho)