IMM Investment, South Korean private equity firm, is accelerating its launch of an eighth blind-pool fund.
At the end of June, South Korea’s National Pension Service (NPS) selected five PE firms as its private equity managers to invest a combined 800 billion won ($665 million). IMM Investment was one of the firms along with Glenwood PE, Macquarie Korea Asset Management, SkyLake Investment, and JKL Partners. Each firm will be mandated to manage 160 billion won from NPS.
Prior to this round of NPS’ annual private equity allocation, IMM Investment has been focusing on NPS’ venture capital (VC) category. IMM Investment’s venture fund has been successful in raising money from the Pension Foundation of the General Assembly of the Presbyterian Churches of Korea, and Korea Development Bank and Korea Growth Investment Corp. (K-Growth) to be selected as a VC manager.
With the NPS mandate this year, IMM Investment is expected to recharacterize its fund more so like conventional private equity instead of venture capital and accelerate fundraising for its eighth blind-pool fund, Petra 8 Private Equity Fund. The fund size is likely to be approximately 600 billion won, about 150 billion won larger than the seventh fund.
“While some PE firms are seeking to launch a fund worth multi-trillion won, IMM Investment tends to keep the size of its blind-pool funds at around 500 billion won,” said an industry source.
Market insiders are still putting question marks as to the eighth fund’s potential portfolio companies. IMM Investment has invested in a variety of industries through its seventh fund, including a 50 billion won investment in the JKL Partners’ acquisition of Lotte Non-Life Insurance last year. This was the firm’s first investment in the insurance industry. IMM Investment’s acquisition of a controlling stake in GS ITM, jointly with JKL Partners, was also notable as the firm has focused on growth investing rather than buyouts.
Attention is drawn on likely impact on IMM Investment’s compliance complication post its being subject to Fair Trade Commission (FTC), the country’s antitrust watchdog, conglomerate regulations, which require that the list of enterprise groups should publish corporate information extensively. IMM Investment was added to the list of conglomerates based on the firm’s total assets exceeding 5 trillion won under the substantial control of its chief executive Ji Sung-bae. Companies included in the watch list are required to disclose extensive corporate information including all of their investment assets.
IMM Investmentinvested the entire committed capital of its seventh fund, which was launched in September 2018, one year after its launch. The PE firm purchased Daewon Concrete & Mining’s convertible bonds worth 35 billion won and sheet mask maker Imine’s redeemable convertible preference shares (RCPS) worth 17 billion won via its seventh fund. The 120 billion won bet on WeMakePrice in December 2019 was the fund’s last investment. (Reporting by Byung-yoon Kim)