Korean pension issues private equity RFP

Public Officials Benefit Association, a Korean public pension fund with 10.1 trillion won ($9.3 billion; €7.9 billion) in assets under management, is seeking blind-pool fund managers to help manage its private equity strategy.

The pension will commit up to $150 million to the chosen managers to invest in buyout, growth, secondaries and co-investment opportunities on a global basis, according to a request for proposals on its website.

The deadline for proposal submission is 29 May.

In May 2017 it allocated the equivalent of $300 million to five different private equity funds, including a $40 million commitment to Goldman Sachs’ Vintage VII secondaries fund. The year before, it allocated $200 million to private equity funds including an undisclosed commitment to HarbourVest’s Dover Street IX secondaries fund. POBA’s overall exposure to secondaries funds is not known.

As of May 2017, POBA had a 12 percent allocation to domestic and overseas private equity out of an overall alternatives allocation of 22 percent, according to PEI data. Last year it announced that it was planning to expand its alternatives portfolio by investing an additional 700 billion won into private equity, sister publication Private Equity International reported.

In December, chief investment officer Dong Hun Jang told PEI that his biggest challenge in 2017 was the fact that RFP processes are getting too large due to the number of participating general partners. Asked what advice he would give to GPs, he added: “The hurdle rate is too low. There needs to be more co-investment opportunities.”