South Korea's National Pension Service (NPS) said on July 11 that it has chosen BlackRock Financial Management (BlackRock) and Grosvenor Capital Management (GCM) as preferred bidders to manage fund of funds for investment in hedge funds in 2016.
The NPS, which plans to begin investing in hedge funds this year, has completed the talks for the consignment management contract with the preferred bidders, and plans to entrust BlackRock and GCM with up to US$500 million (567.5 billion won) each, the pension fund’s investment management office said in a statement.
NPS Chief Investment Officer Kang Myoun-wook said, “The upcoming hedge fund investment is expected to contribute to the generation of stable profits by diversifying risk for the fund’s entire portfolio.”
The NPS has 512 trillion won (US$415 billion) in assets under management, becoming the world’s third-largest pension fund
BlackRock was founded by eight people in 1988 with the capital of US$1 billion (1.14 trillion won). Now, 28 years later, it has become one of the world's largest asset manager which has US$4.6 trillion (5,221 trillion won) in assets under management. The firm has approximately 12,000 employees in over 100 offices in 30 countries across the world.
GCM Grosvenor is one of the world's largest independent alternative asset management firms, with over US$45 billion (51.08 trillion won) in assets under management and 450 employees. Starting with Tokyo in 2006, the Chicago-based firm opened its office in London in 2007, Hong Kong in 2012 and Seoul in 2015. Founded in 1971, it has a relatively long history but its assets under management is smaller than the NPS.