Korea's military fund, LIG Nex1, IBK to form $60 mn defense fund

They will select local companies in AI, robotics, unmanned transportation, aerospace, chip and advanced materials sectors

Military Mutual Aid Association headquarters in Seoul

Ji-Eun Ha 1

2024-02-16 15:34:06 hazzys@hankyung.com

Pension funds

South Korea’s Military Mutual Aid Association (MMAA), a retirement savings fund for military personnel, will create an 80 billion won ($60 million) blind pool fund for the defense and technology sectors along with LIG Nex1 Co. and IBK Capital Corp.

MMAA will invest 40 billion won, while investment bank IBK Capital and defense system developer LIG Nex1 will inject 25 billion won and 15 billion won, respectively, according to the retirement savings fund earlier this week.

LIG Nex1 and IBK Capital will jointly manage the fund and select domestic companies in artificial intelligence, robotics, unmanned transportation, aerospace, semiconductor, advanced materials and other sectors.

MMAA said it expects LIG Nex1 will identify promising companies based on its wide range of networks in the defense sector, and IBK Capital will leverage its experience in fund management for small and mid-sized enterprises.

The fund will contribute to the enhancement of Korea’s military power and generate high returns to strengthen the mutual aid association members’ welfare programs, MMAA added.

MMAA manages 10.4 trillion won in assets as of Dec. 31, 2023. Alternative investments amount to 8 trillion won, of which 46% are invested in overseas assets.

Write to Ji-Eun Ha at hazzys@hankyung.com

Jihyun Kim edited this article.