South Korea’s KB Asset Management has decided to invest $150 million into a combined cycle power plant construction in the U.S. with funds pooled from Korean major institutional investors.
According to investment banking officials Sunday, KB Asset Management will raise $150 million from local pensions and securities firms to partly finance the 1,000-megawatt gas-fired combined cycle power plant to be constructed by Hickory Run Energy in Pennsylvania.
KB Asset Management would be taking part as one of the loaners for the $863 million project to which Japan’s Tyr Energy, an affiliate of Itochu Corp., Kansai Electric Power Co. and Germany-based Siemens Financial Services will fully own interest. In return for lending the money, the Korean investors will receive a promise of interest income and repayment of the principal. The eight-year investment is expected to yield an annual profit of around 5 percent.
The region is near the Marcellus and Utica shale fields, ensuring a stable supply of gas needed to fuel the plant.
By Kang Doo-soon
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