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NPS joins hands with Keppel Capital for Asia infrastructure investment

NPS headquarters in Jeonju, North Jeolla Province in South Korea (Yonhap)
NPS headquarters in Jeonju, North Jeolla Province in South Korea (Yonhap)
The National Pension Service, South Korea‘s public pension fund, has entered into a strategic cooperation with Singapore-based Keppel Capital to beef up private infrastructure investment in Asia.

According to the investment arm of offshore rig builder and shipbuilder Keppel, the strategic cooperation is meant to foster capabilities to manage energy and environmental infrastructure assets, including renewables and related technology solutions, urban development and connectivity solutions.

The partnership builds on the undisclosed amount of commitment by the NPS to Keppel Capital made in the second quarter this year.

“Notwithstanding the current challenging macroeconomic environment, we are confident that by working together with a world-class and like-minded institutional investor, we will be able to synergize and tap into each other’s expertise and capabilities,” said Keppel Capital Chief Executive Christina Tan in a statement Monday.

Both NPS and Keppel Capital declined to elaborate further on the deal terms.

This comes in line with a move by the world’s third-largest public pension fund with 752 trillion won ($646.7 billion) under its management to increase its exposure to alternative investment in its future portfolio management. By 2021, NPS vowed to increase the alternative exposure by 0.2 percentage point in a year and add 2 trillion won to its exposure to infrastructure asset.

As of end-June, NPS has invested a total of 26.1 trillion won in infrastructure assets, which account for nearly 4 percent of the entire assets under management. This takes up 28.9 percent of the whole alternative investment. About two-thirds of the infrastructure investments come from cross-border deals.

Keppel Capital was one of the two fund managers added in the second quarter to work with NPS in overseas infrastructure investment, out of 36 foreign managers in total.

By Son Ji-hyoung (