South Korean institutional investors are expected to invest up to 300 billion won ($265.5 million) in an infrastructure fund managed by France-based Mirova Asset Management that targets infrastructure projects in Europe.
According to multiple sources from the investment bank industry on Tuesday, local institutional investors including insurers and mutual aid associations have decided to invest between 200 billion won and 300 billion won in Mirova Core Infrastructure fund worth 1 billion euros ($1.2 billion), managed by Mirova Asset Management. Their total investment amount would be adjusted depending on investment conditions. They will invest in the fund through Korea Asset Investment Securities Co.
The fund managed by Mirova Asset Management is a blind fund that collects funds from investors without having a fixed investment target. It is expected to invest in various infrastructure assets including thoroughfares, airports, power plants and water supply facilities in Europe. The 25-year infrastructure fund - which will mainly target public-private partnership (PPP) projects in Europe - is expected to raise an annual return of between 8 and 9 percent.
Demand for PPP projects in Europe has been on a rise in recent years. Some 46 billion euro worth of fresh funds have been injected in various PPP projects since 2014, sources note.
Mirova Asset Management, a subsidiary of Natixis Global Asset Management, is renowned for its expertise in investment in global infrastructure projects. Of its total 1.6 billion euro worth investment in infrastructure projects, more than 900 million euros have been allocated to social overhead projects in Europe.
By Kang Doo-soon
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