A few key institutional investors in South Korea are set to commit up to $300 million to a $3.5 billion private credit fund by US private debt manager Antares Capital LP, investment banking sources said on Friday.
Three Korean mutual aid funds have committed $160 million to the fund. Yellow Umbrella Mutual Aid Fund, Korea Scientists & Engineers Mutual Aid Association (SEMA) and Military Mutual Aid Association (MMAA) have respectively committed $70 million, $60 million and $30 million, The Korea Economic Daily understood. Some other Korean institutions, including insurers, are also considering capital commitments this month, sources added.
Headquartered in Chicago, Antares Capital is specialized in loans to middle-market, private equity-backed companies. Canada Pension Plan Investment Board (CPPIB) acquired the private credit manager from GE Capital for $12 billion in 2015. As of end-2021, Antares manages more than $50 billion in assets.
The private debt manager has tied up with Korean limited partners for years. It
raised $200 million from Korea in 2018, including $70 million from Public Officials Benefit Association (POBA) and $100 million from the Police Mutual Aid Association (PMAA) via a credit fund investing in US middle-market companies.
In Korea, private credit funds are garnering attention thanks to the characteristics of stable cash flow amid rate hikes. A revised version of the Financial Investment Service and Capital Market Act came into effect last October to allow more private debt investments, boosting local PE firms’ credit fund management. IMM Private Equity and Glenwood Private Equity are among the key players in the country’s private credit market.
IMM Private Equity launched IMM Credit & Solutions (ICS) in late 2020. The credit investment arm
acquired a 40% stake in SK Lubricants Co. for 1 trillion won ($789.1 million), SK Group’s lube-making unit, in April 2021. The credit unit acquired 100 billion won worth of convertible preferred shares in W Concept, a leading fashion app in Korea.
Glenwood PE also launched Glenwood Credit in September 2021. Last November, the credit investment arm
joined the acquisition of a 60% stake in S&I Construction and Engineering as a financial investor. GS Engineering & Construction Co. invested 300 billion won, and Glenwood Credit funded the remaining 100 billion won.
Write to Chae-Yeon Kim and Jun-Ho Cha at
why29@hankyung.comJihyun Kim edited this article.
