이 기사는 2020년 03월 05일 08시00분 thebell에 표출된 기사입니다

Teachers’ Pension, a South Korean pension scheme for private school educators, has closed applications for external alternative managers last week, with a competition rate of one out of almost three.

The pension fund, with more than 19 trillion won ($16 billion) in assets under management, received eight proposals from PE firms, sources close to the matter said on Monday.

The fund plans to commit total 150 billion won to three PE firms – 50 billion won for each – which will be selected through a tender process. Due to the relatively large size of commitment and less complex qualification requirements, many of the firms on the fundraising trail appear to have summited proposals.

Most of other domestic institutions have recently finished allocating capital to PE managers through their quasi-annual selection process. Military Mutual Aid Association (MMAA) committed 20 billion won to each of five managers in February, while the Public Officials Benefit Association (POBA) and the Government Employees Pension System (GEPS) respectively allocated 40 billion won to each of three PE firms in the same month.

The investment program, announced by Teachers’ Pension last month, has drawn attention from several PE firms in their final stages of fundraising since they, if selected, would be able to secure 50 billion won for their new fund – a larger amount than commitments from other institutions ranging from 20 billion won to 40 billion won.

Going forward, the pension fund plans to shortlist up to six firms, followed by conducting due diligence. The final results are expected to be announced in April.

This is the third time that Teachers’ Pension has launched a tender process to select managers for its private equity portfolio over the past five years.

In 2018, the pension fund committed total 200 billion won to STIC Investments and IMM PE, following allocating a combined 60 billion won to SG PE and Aju IB Investment in the previous year. It also allocated 20 billion won each to five managers – STIC Investments, IMM PE, Mirae Asset Global Investments PE, Corstone Asia and NAU IB Capital – in 2015.

(By reporter Rho Ar-rum)