Foreign Funds Rolling In

National Pension Service signs three MOUs for joint investments with U.S. fund management firms including Blackstone

The National Pension Service signed a memorandum of understanding with Blackstone Group to make joint investments in Korea worth $2 billion. The signing took place at the NPS headquarters in Seoul with President Park Hae-choon and Blackstone Group Asia-Pacific Representative Ben Jenkins signing the agreement for their respective companies.
Under the agreement, the NPS will get $2 billion from Blackstone as funds to be jointly invested with NPS funds in Korea.
The U.S. private equity fund plans to make investments primarily in such areas as corporations, infrastructure, and real estate, but the fund will also look at securities and a variety of domestic bonds issued in Korea.
Under the MOU, the NPS will be able to use Blackstone's overseas network to find investment projects abroad, NPS officials said.
Blackstone Group Chairman Steve Schwarzman said the MOU is part of Blackstone's huge interest in Korea with a number of superb global enterprises and companies with highly-developed technologies based on a well-developed financial market. The chairman said he was very happy that Blackstone was able to have a strategic partnership tie-up with NPS, the fifth largest pension fund in the world, which is very important to not only Korea, but also to Blackstone's business operations around the world.
Based in New York, Blackstone Group is an international professional alternative asset management company. Investors in the group consist of equity funds and national wealth funds, many of them in foreign countries.
NPS expects Blackstone to help diversify and boost its investments, resulting in investment success.
Blackstone, founded in 1985, is a leading global alternative asset manager and provider of financial advisory services listed on the New York Stock Exchange (ticker symbol BX) with $119.4 billion in total assets under management of as of June 30, 2008. The company seeks to create a positive economic impact and long-term value for its investors, the companies in which the group invests, the companies it advises and the broader global economy. The company does this through the commitment of its extraordinary people and flexible capital.

Its alternative asset management businesses include the management of:
- Corporate private equity funds
- Real estate funds

Marketable alternative asset management funds, including:
- Funds of hedge funds
- Debt funds
- Proprietary hedge funds
- Collateralized loan obligation vehicles (CLOs)
- Closed-end mutual funds

The company also provides various financial advisory services, including:
- Corporate and mergers & acquisitions advisory
- Restructuring and reorganization advisory
- Fund placement advisory

As of June 30, 2008, the group had 89 senior managing directors and employed over 750 other investment and advisory professionals at its headquarters in New York and its offices in Atlanta, Beijing, Boston, Chicago, Dallas, Hong Kong, Houston, London, Los Angeles, Menlo Park, Mumbai, Paris, San Francisco and Tokyo.
In the meantime, NPS completed an MOU with Oaktree Capital Management on Oct. 7 for the joint investment of up to $3 billion in Korea. NPS followed it up with another signing of an MOU with MBK Partners, providing for attracting foreign investment up to $2 billion, NPS officials said.
Chairman Kim Byung-joo of MBK Partners and President Park Hae-choon of NPS signed the instrument, which brings the amount of foreign funds attracted by NPS to $5 billion. The move is considered quite a feat, as it came when domestic banks have been having trouble attracting foreign funds due to the turmoil in the world financial market in recent months.
MOUs signed with Oaktree Capital management and MBK Partners provide for making joint investments in Korea worth $5 billion, mostly in the areas of domestic infrastructure facilities, corporate projects at home and real estate -- all in alternative investments.
NPS has been able to attract these funds through its own credit, which has been proven sound enough to these foreign capital management companies. The funds are likely to contribute to the stabilization of the Korean financial market. nw

President Pak Hae-choon of the National Pension Service, 2nd R, and Ben Jenkins, Blackstone Asia-Pacific representative, 3rd L, hold the MOU they signed on making joint investment in Korea.