Korean investment private equity plans to invest 1 trillion won to lock in AI infrastructure

Big investment in AI infrastructure is coming! South Korea invested 1 trillion won in private equity, targeting data centers and power grids. (Reuters)

[Financial Channel/Comprehensive Report] Artificial intelligence (AI) infrastructure investment has added a large amount of funds. Korea Investment Private Equity (KIPPE), a subsidiary of Korea Investment Finance Group, announced on the 28th that it will combine the group's capital and its own funds to establish an investment platform with a scale of 1 trillion won (approximately NT$23 billion), targeting infrastructure fields such as artificial intelligence data centers (AIDC), large power generation facilities, energy storage systems (ESS) and high-speed communication networks.

Korean media reported that Korea Investment Private Equity said that this investment platform will use the capital strength of Korea Investment Financial Group and its own capital contribution (GP commitment), with the main purpose of accelerating the large-scale infrastructure investment required for the development of artificial intelligence. Rather than relying solely on external investors for financing, the company plans to directly use the group's own funds to speed up investment decisions and capital execution.

Please read on...

As of the end of June this year, the assets under management of Korea Investment Financial Group were approximately 607 trillion won (approximately NT$13.96 trillion). Korea Investment Private Equity combines the group's financial and investment capabilities with its own capital to identify investment opportunities that require large-scale capital investment in the field of artificial intelligence infrastructure.

In fact, Korean investment private equity companies have recently continued to increase their exposure to the energy and infrastructure sectors. In June last year, the company and STICK Alternative Asset Management jointly completed the acquisition of 49% of the shares of SK Ulsan GPS and SK Multi-Utility Company. The total transaction amount reached 1.5952 billion won (approximately NT$36.689 billion), and SK Group held 51% of the shares of the two companies to maintain management control.

In addition, the KIPPE also participated in Hanwha Energy's equity investment with Korea Investment Securities and Dasin Securities last year, acquiring 20% ​​of Hanwha Energy's shares held by Hanwha Life President Kim Dong-won and Hanwha Hotels and Resorts Vice President Kim Dong-sun for approximately 1.1 trillion won (approximately NT$25.3 billion), of which Korea Investment Securities Private Equity Fund assumed approximately 500 billion won (approximately NT$11.5 billion).

In 2023, Korea Investment Private Equity will also participate in SK On’s pre-IPO equity investment. This time, it plans to expand its past strategy of investing in minority equity while allowing the original major shareholders to maintain management control to include artificial intelligence data centers and power infrastructure.

With the popularity of generative artificial intelligence, data centers not only need to invest a lot of money to build servers and GPUs, but also need large-scale power supply and cooling facilities to maintain operations. Therefore, power infrastructure such as power generation facilities and energy storage systems have also become investment targets.

Grasp the economic pulse with one hand. Click here to subscribe to Free Finance Youtube Channel