South Korea’s largest institutional investor National Pension Service (NPS) has invested $450 million in global private equity funds that invest in infrastructure assets in North America, betting on large infrastructure spending by incoming U.S President Joe Biden.
According to industry sources, NPS recently injected about $250 million in a fund launched by New York-based Stonepeak Infrastructure Partners and $200 million in a fund run by Macquarie Infrastructure Corporation, a unit of Australian multinational investment bank Macquarie Group.
Both funds are designed to invest in North American infrastructure assets and businesses, ranging from transportation and communications to power, utilities, and water treatment. Their main targets are infrastructure assets that are engaged in long-term contracts.
NSP, the world’s third largest pension fund with 785.4 trillion won ($715.4 billion) worth assets under management, expects about a 10-percent return from its investments in the two infrastructure funds.
NPS’s latest investment decision was made on expectations that the infrastructure market in the U.S. would grow rapidly under Biden administration. The Democrat president-elect has announced an economic spending plan of $4 trillion with nearly 22 percent to be injected into infrastructure projects.