Insto roundup: KIC adds new alts heads; NPS hands Russell Investments a $1b mandate

Australia's MLC Life gets capital from Nippon Life and NAB; Ping An to buy properties from Agile Group; KIC names heads of alts and private equity; NPS appoints Russell Investments for $1b real estate mandate; CDPQ co-invests in $2.7b Taiwan offshore wind farm deal; GIC makes first Vietnam healthcare investment and more.
Insto roundup: KIC adds new alts heads; NPS hands Russell Investments a $1b mandate


Insurer MLC Life received an A$650 million ($502 million) capital injection from Japanese insurer Nippon Life and National Australia Bank (NAB).

“Risk of MLC Life’s stagnant business performance continuing beyond next year is of concern in light of the increased unemployment rate due to [the] worsening economy impacted by Covid-19 and expected increase in claims payment and cancellations,” Nippon Life said in a statement.

The insurer also said the capital was divided into two parts: an A$530 million ordinary equity issue by Nippon Life and NAB, and tier 2 capital notes of A$120 million to be subscribed to by Nippon Life.

Source: Nippon LifeMoney Management


Annuities can now invest up to 40% of their investment portfolio into equity assets, 10 percentage points more than before, according to the new rules released by the Ministry of Human Resources and Social Security (MOHRSS).

They are also allowed to invest in the Hong Kong market, including preferred shares, asset-backed securities and interbank deposit certificates, among others. The new rules took effect on January 1.

Source: MOHRSS

Chinese property developer Agile Group is selling stakes worth Rmb7.05 billion ($1.08 billion) in seven property projects to Ping An Insurance, a move that should bring it much-needed cash before a regulatory hurdle for borrowing takes effect and allow Ping An to deepen its footprint in China's property market.

Hong Kong-listed Agile is selling its interests in the developments, mainly in southern and east-central parts of mainland China, to a group of Ping An subsidiaries. The property company was looking to sell the developments ahead of the 'three red lines' rules being introduced on January 1, 2021, which prohibit real estate developers from borrowing if they fail to hit three financial criteria. 

The rules require developers to cap their liability-to-asset ratio, excluding advanced proceeds, at 70% and their net debt-to-equity ratio to 100%. Plus, their cash to short-term debt ratio must be at least one.

Source: South China Morning Post


The Indonesian government said it was ready to begin a second round of fundraising for its planned sovereign wealth fund, which has so far secured commitments of up to $15.5 billion from the US International Development Finance Corporation and the Japan Bank for International Cooperation, among others.

Canada’s CDPQ and Netherlands’ APG could also be making commitments to the fund, said Minister of Maritime Affairs and Investment Luhut Pandjaitan, who is leading the fundraising efforts.

The new vehicle, announced in November 2020, could be launched as early as mid-January and is intended to catapult infrastructure investment into the country. Indonesia will commit up to $6 billion to the fund, which will be known as the Nusantara Investment Authority.

Source: Financial Times


Korea Investment Corporation (KIC) has appointed Park Jin-Seong as head of alternative investment and Huh Jea-Young as head of private equity investment. They succeeded James Kim and Hoon Lee, who were both promoted to deputy chief investment officers in June. 

Park and Huh will retain their former positions as heads of absolute return investment and real estate investment, respectively, on a temporary basis.

Meanwhile, KIC has also appointed Kim Ho-gyun to succeed Lee Seung-kul as head of its Singapore office, the sovereign wealth fund said in a statement, but it did not identify Kim’s current role or Lee’s new position.

Source: Asia Asset Management

National Pension Service (NPS) appointed US asset manager Russell Investments for a $1 billion global listed real estate mandate, the state retirement fund's latest move to step up exposure to alternative assets. This is Russell Investments’ second global real estate securities mandate from NPS, the pension fund said in a statement.

Scott Kim, head of NPS’s real estate investment division, said the new mandate allowed the fund “to efficiently capture the potential price discrepancies between public and private real estate markets” and it will also be “an excellent portfolio diversifier”.

NPS has been increasing real estate investments in recent years as part of its plan to raise its allocation to alternatives from 11.4% of total assets in 2019 to 15% by 2023 in order to diversify risk.

Source: Asia Asset Management

Korea Post has chosen US asset managers Argo Infrastructure Partners and Stonepeak Infrastructure Partners for a $200 million overseas infrastructure mandate.

The government postal agency, which opened the tender on November 10, had said in its request for proposal that the investments would mainly be into greenfield infrastructure stocks and assets in North American markets.

This is the postal agency’s second overseas infrastructure strategy since February 2019.

Source: Asia Asset Management

South Korean insurance companies need to increase the proportion of performance-related pay in the annual remuneration of their chief executives, to incentivise them to perform better, says the Korea Insurance Research Institute.

Base pay makes up 64% of the annual salary of the CEOs of South Korean insurers while short-term and long-term performance-related pay account for 19% and 17%, respectively. The respective ratios are 16%, 5% and 73% in the case of their US counterparts, according to the institute.

“The South Korean CEOs are getting high pay regardless of their performance, and this means that no incentives are being provided for their corporate value enhancement efforts,” it said.

Source: Business Korea


Malaysia’s Employees Provident Fund (EPF) disposed of 667.3 million shares in the last three months as part of a wider portfolio overhaul.

CapitaLand Malaysia Mall Trust represented the largest disposal, with 237.3 million shares sold. Other large disposals include Inari Amertron (70.3 million shares), Axiata Group (50.9 million shares) and Top Glove Corp (38.2 million).

The liquidation of assets has been driven by an anticipated MYR45 billion ($11.2 billion) withdrawal from two of EPF’s emergency schemes, i-Lestari and i-Sinar, by the end of 2021.

Source: The Malaysian Reserve

EPF reported gross investment income of MYR17.33 billion ($4.3 billion) for the third quarter of 2020, up from MYR13.5 billion for the equivalent period in 2019, according to its website.

Equities, fixed income, and real estate and infrastructure accounted for MYR7.29 billion, MYR8.18 billion and MYR1.63 billion, respectively, while money market instruments contributed MYR230 million.

“Our financial positions over the first three quarters have been affected by the volatility in market sentiments exacerbated by the uncertainties of the Covid-19 pandemic and continued fragile consumer sentiments,” said EPF chief executive Alizakri Alias.

Source: The Malaysian Reserve


GIC and ESR Cayman have formed a joint venture to invest $750 million in industrial and logistics assets in India. The Singapore sovereign wealth fund holds an 80% in the JV, which aims to develop facilities and acquire existing assets across India.

A spokesperson for GIC said the JV was expected to capitalise on long-term e-commerce growth and rising internet penetration in India, which is driving demand for industrial and logistics assets in the country, coupled with infrastructure development, supply chain changes and high occupancy levels.

Source: IPE

Singapore’s GIC has led a consortium to acquire a minority stake in Vinmec, a private hospital operator under Vietnam’s Vingroup, for Vnd4.7 trillion ($203 million).

The sovereign wealth fund will receive an undisclosed share in Vinmec, though Vingroup would remain the sole controlling stakeholder.

This marks GIC’s first healthcare investment in Vietnam, though it has previously invested in the Vietnamese conglomerate’s retail business.

Source: DealStreetAsia

GIC has finalised its acquisition of a 17.5% equity stake in AC Energy, the energy investment arm of Philippine conglomerate Ayala Group, through its affiliate Arran Investment.

The investment was implemented through a subscription of 4 billion primary shares via a private placement and the purchase of secondary shares.

The Php20 billion ($416.5 million) deal, first announced in November, reduces Ayala’s ownership in AC Energy to around 64%, down from 81% before the acquisition. The remaining shares are publicly held.

Source: Manila Bulletin 


Canadian pension fund CDPQ has acquired 50% of Taiwan’s 605 megawatt Greater Changhua 1 offshore wind farm for around NT$75 billion ($2.67 billion) in a joint investment with Taipei-based Cathay Private Equity. 

It is CDPQ’s first direct investment in Taiwan through its infrastructure team, which has a long track record in the renewable energy sector.

Danish renewable energy developer Ørsted will retain 50% ownership and deliver the construction and long-term operating and maintenance services for the project, which is expected to be completed by 2022.

Source: CDPQ

Canada Pension Plan Investment Board (CPPIB) has established a joint venture in Indonesia with logistics real estate specialist Logos to develop logistics facilities in greater Jakarta.

The Canadian fund will invest $200 million into the JV, which will develop a diversified portfolio of facilities targeted at third party logistics, data centre and industrial tenants.

This is the second tie-up between CPPIB and Logos in Indonesia, after they launched a partnership in 2017 with another international investor.

Source: CPPIB

The California Public Employees’ Retirement System had been expected on January 19 to unveil its new chief investment officer to replace Ben Meng, but Calpers spokesman Wayne Davis said that was now unlikely.

Meng had made a surprise resignation in August last year following the announcement of an ethics investigation and after 18 months with the fund dogged by controversy over his alleged links to the Chinese government.

There had been interviews of finalists in December, but Davis said the search process was still continuing. Calpers chief executive Marcie Frost has said she wants a CIO comfortable handling national media interviews and with extensive investment knowledge.

Source: Chief Investment Officer


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