Park Jae-hyuk is a seasoned journalist who has provided comprehensive coverage of South Korea's corporate dynamics, economic policies, industry challenges and the global positioning of Korean companies. Based on the articles he has written since joining The Korea Times in 2016, his investigative approach has helped readers understand corporate governance, economic trends and business strategies shaping South Korea’s economy.
Canadian pension fund stays mum on labor union's concerns over MBK Partners
gettyimagesbank
By Park Jae-hyuk
By Park Jae-hyuk
CPP Investments, a global investment management firm that invests the assets of the Canada Pension Plan, has remained silent about a letter sent to it by the Canadian Labour Congress (CLC) last Friday asking the pension fund manager to review its investment in MBK Partners in terms of its commitment to responsible investment and long-term value creation.
“Unfortunately, we will not have any comment to this,” CPP Investments corporate communications director Connie Ling told The Korea Times via email, Thursday.
The CLC also said it has not yet received a reply from CPP Investments.
“As you're aware, as a first step, the letter asked the fund to investigate our concerns internally and with MBK Partners as well,” CLC social and economic policy director Chris Roberts told The Korea Times via email, Friday. “We're now waiting to learn the results of that investigation, and will reassess when we receive a response to our concerns.”
In the letter sent to CEO Mark Machin, CLC President Hassan Yussuff said the Federation of Korean Trade Unions and the Korean Confederation of Trade Unions had brought several complaints to his organization's attention regarding MBK Partners.
“Since 2008, the CPP Investments' Private Equity Asia group has progressively committed greater funds to MBK Partners, for an accumulated total of 1.5 billion Canadian dollars ($1.2 billion) invested in four separate MBK funds,” the letter reads.
“However, the firm appears to have a history of mass layoffs and predatory behavior, and questions have been raised regarding the compliance of MBK principals with Korean tax law.”
Yussuff asked Machin to investigate these concerns with CPP Investments' Private Equity Asia group and asked its investment team to inquire with MBK Partners.
“If the practice and behavior of MBK Partners indeed falls short of CPP Investments' high standards for responsible investment and long-term value creation, I ask that CPP Investments consider abandoning MBK Partners as an investment opportunity,” the letter reads.
CPP Investments is one of the world's largest investors in private equity.
According to its website, it committed $200 million to MBK II in 2008, $300 million to MBK III in 2012, $450 million to MBK IV in 2016 and $500 million to MBK V in 2019.
MBK Partners declined to comment on whether it had talked with CPP Investments regarding the letter but said that the claims in it were “groundless” and “malicious.”
The private equity firm has denied all allegations made against it, whenever it faced criticism from unions and civic groups here.
According to MBK Partners, its portfolio companies, including Homeplus, have guaranteed its employees job stability.