A $1 billion corporate partnership (COPA) fund created by SK Holdings Co Ltd and Korea Teachers’ Credit Union (KTCU) has made its second investment after investing in Texas-based Brazos Midstream earlier this year.
SK Holdings (the parent of South Korean conglomerate SK Group) and KTCU have completed a $300 million investment in Chindata Group, a Chinese data center operator, industry sources said on August 14. Each investor has invested $150 million in the company.
SK Group and KTCU launched the COPA fund in September 2019, each contributing $500 million to the fund. KTCU has picked IMM Investment as its general partner to provide capital commitments. SK Holdings and a private equity fund created by IMM Investment jointly make investments. The investment period of the fund is four years.
The fund’s first investment was Brazos Midstream, a U.S. shale gas gathering and processing company. SK Group and KTCU have reportedly invested more than half of the fund’s committed capital one year after its launch.
KTCU partnered with SK Group to provide financial support when the group makes cross-border investments in new growth industries. SK Holdings could reduce its fundraising burden by attracting a financial investor while KTCU could have an opportunity to bolster its investment returns by joining forces with SK Group to invest in blue-chip assets in overseas markets.
They are focusing on deal sourcing in sectors with high growth potential. The data center sector is considered one of the sectors that have high growth potential in global markets, with demand for data centers growing rapidly.
The latest deal is meaningful in that it is an outcome of a partnership between SK Holdings and IMM Investment. They have worked together over the past three months to win the deal. This fits with the aim of the COPA fund – to make the country’s conglomerates collaborate with financial investors to seek new growth engines in overseas markets. (Reporting by Hye-ran Kim)