Fund Planned to Form by Year-End Delayed to Next Year
Controversy Over Fundraising Integrity Amid Financial Tightening
Investment Intentions Asked Only via Email
[Asia Economy Reporter Kwangho Lee] Atinum Investment's (Atinum) first blind fund formation of the year has hit a snag. They aimed to raise a fund worth 800 billion KRW within the year but are facing difficulties in securing capital. Meanwhile, negative sentiments are being detected among existing limited partners (LPs), drawing attention.
According to the investment banking (IB) industry on the 28th, Atinum is in the process of forming the ‘Atinum Growth Investment Partnership 2022’ worth 800 billion KRW. So far, they have raised about 500 billion KRW. This is thanks to contributions from major pension funds including the anchor LP, the National Pension Service, the Korea Post, and the Science and Technology Promotion Fund.
The problem lies with the remaining amount. They need to secure several hundred billion KRW more to reach the target fund size. However, due to the global economic downturn, LPs’ stances have become conservative. The mood is to postpone contributions until next year.
Accordingly, Atinum has postponed the first closing from the end of this year to the first half of next year. Although closing immediately would not be an issue, it is interpreted that they are reluctant to form the fund at a lower amount compared to previous funds. Previously, the ‘Atinum Growth Investment Partnership 2020’ formed in December 2020 was worth 550 billion KRW.
Atinum adheres to a ‘one-fund’ management strategy, focusing its capabilities on a single fund. Recently, they have continuously increased the scale with Atinum Growth Investment Partnership 2018 (350 billion KRW) and Atinum Growth Investment Partnership 2020 (550 billion KRW). This time, they are targeting 800 billion KRW, but it is expected to be difficult.
On the surface, the unstable market situation is a factor, but the industry explains there are other reasons. They were confident, trusting the existing LPs who have consistently contributed. While major funds were secured through key LPs like the National Pension Service, the process of raising the remaining funds caused dissatisfaction.
A senior official from a private LP said, “We have contributed several times to Atinum’s partnerships and maintained a smooth relationship,” adding, “We were also asked to contribute this time, but the approach was wrong.” He pointed out, “When hundreds of billions of KRW are involved, it is natural to have meetings and detailed explanations,” and criticized, “Atinum only sent emails at the staff level asking about willingness to contribute.”
Another official added, “Although they plan to create the largest fund ever, there is doubt whether the fund can be formed early next year as LPs’ dissatisfaction arose during the fundraising process.”
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