Altius, Castling join to target Korean LPs

The firms have signed an agreement to help domestic investors tap alternative asset funds globally.

Global fund of funds Altius Associates and Korean advisory firm Castling Investment Group have signed a memorandum of understanding to jointly provide institutional investors in Korea with private equity, real assets and infrastructure opportunities, according to a joint statement.

The strategic business alliance intends to market overseas alternative asset funds to Korean investors, using Altius’ international brand name and Castling’s local expertise to bring the targeted parties together.

“We are very pleased to have forged this alliance with Altius Associates in order to meet the growing demand for private equity, real assets and infrastructure here in South Korea,” Steve Kim, partner and chief investment officer at Castling, said in a statement.

“Korean institutional investors appreciate a foreign brand name, but they also want local client servicing from experienced, senior-level professionals who are there to help them with all facets of their investment programme and portfolio development, including post-investment monitoring and reporting services.”

Altius executive chairman John Hess added, “This relationship with Castling will provide Korean investors wishing to gain exposure to global alternative investments in the real assets and private equity space with a best-in-class investment and asset management platform. We are excited by the opportunities available in Korea, which is a market with significant growth potential.”

While Korea has in general felt a negative sentiment toward private equity as an asset class, institutional investors in the country are increasingly seeking exposure to private equity overseas.

“The issue with Korean institutions today is they are heavily invested in domestic stocks and domestic real estate. There is definitely a push here to broaden their alternatives portfolios and there is a huge push to diversify internationally,” Kim said in an earlier interview with Private Equity International.  

Investments in alternative asset classes used to be optional for Korea’s institutional investors, who have tended to focus squarely on domestic investments, explained Yun Kyu Lee, KTPF’s former CIO, speaking at PEI’s Global Alternative Investment Forum in Seoul last June. “Now it’s a must. They are rushing toward it.”

However, while there is significant interest in investing abroad, industry sources have expressed concerns that this is a risky strategy for conservative investors with little experience or resources to assess opportunities overseas.

“Many do not have enough experience,” Lee added.