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Korean experts come to fore in global private equity industry
By Park Jae-hyuk
A series of lucrative investment opportunities have made it possible for the Korean market to emerge as one of the most attractive destinations for global private equity investors, prompting them to look for more Korean experts to manage their assets, according to industry representatives, Friday.
The Canada Pension Plan Investment Board (CPPIB), one of the world's largest investors in private equity firms (PEFs), is a recent example.
Earlier this week, the CPPIB announced that its Asia Pacific head, Suyi Kim, will be promoted to global head of its private equity department Sept. 15, to lead a team which was managing $100 billion in assets as of March 31.
The decision was announced two months after the executive unveiled the board's plan to make long-term investments in Korean public and private equities, and real estate, during a web conference held May 26 by the Institute for Global Economics.
Kim joined CPPIB in 2007 as the head of its private equity business in Asia and contributed to the opening of its Hong Kong office in 2008, after working for the Ontario Teachers' Pension Plan, the Carlyle Group, McKinsey & Company and PricewaterhouseCoopers.
"Suyi's background in private equity, extensive experience leading our Asia Pacific business and deep knowledge of the organization make her ideally suited for this role, and demonstrate the depth of our leadership team," CPPIB CEO John Graham said in a press release, Wednesday. "I am confident that with her global expertise, Suyi will build on the success of a strong and experienced private equity team to continue to deliver solid long-term results for our contributors and beneficiaries."
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| Canada Pension Plan Investment Board Asia Pacific Head Suyi Kim delivers a lecture at the Lotte Hotel Seoul in this January 2019 file photo. Courtesy of the Institute for Global Economics |
Multiple PEFs based abroad are also trying to expand their presence here by hiring more Korean nationals.
In the past, most of them were reluctant to allow Korean executives at their Seoul offices to make important decisions, although three Korean Americans ― Carlyle CEO Kewsong Lee, KKR co-President Joseph Bae and Blackstone Chief Financial Officer Michael Chae ― have held top positions at the world's three largest PEFs for several years.
The adjustment has been mainly attributed to large-scale merger and acquisition (M&A) deals here, valued at over trillions of won.
Blackstone, one of the participants in the bid to acquire Hanon Systems worth 7 trillion won ($6 billion), recently recruited analyst-level investment professionals, who will work to handle Korea-focused transactions at its Seoul office, which is reportedly supposed to reopen by the end of the year.
According to industry sources and media reports, the U.S. firm set up a temporary office at the Four Seasons Hotel Seoul, ordering its Korean managing director, Eugene Cook, to organize the Korea-focused team.
EQT Partners, a Swedish PEF owned by the Wallenberg family, is also reportedly considering forming a team for its Korea-focused investments.
Its decision in 2018 to hire director Jay Chae, who studied at Korea University and worked for Blackstone and Lehman Brothers, has been regarded by some market insiders as a preparatory action by the investment firm for the plan.
Data compiled by the Financial Supervisory Service (FSS) showed that the number of funds managed by PEFs in Korea reached a record high of 855 last year, while their sizes collectively amounted to 97.1 trillion won.
Given that the Korean private equity market has shown solid growth over the past few years, the trend of global investors paying attention to the domestic market should continue for a while.
"PEFs have tended to tighten their grips on the capital market as the major players in the corporate M&A sector," an FSS official said. "Because eased regulations have enabled various investment strategies, they are expected to rev up corporate restructurings and M&As."
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