South Korea's Military Mutual Aid Association (MMAA) and South Korea’s National Pension Service (NPS) will invest respectively €40 million (US$44.7 million) and €250 million (US$282 million) in Macquarie European Infrastructure Fund 5 (MEIF5) that is aiming to raise €2.5 billion (US$2.8 billion).

Other South Korean institutional investors including the Yellow Umbrella Mutual Aid also plan to participate in the fund.

The MEIF5 managed by Macquarie will invest in core and core plus infrastructure assets, communications and transport facilities in Europe for the next 12 years, and will pay dividends on a yearly basis. Investors expect annual returns ranging from 7 percent to 9 percent.

According to sources, Jin Woo Kim, MMAA’s head of alternative investment division, said: 

“(MEIF5) will focus on infrastructure assets which have high regulatory barriers and are being operated under long-term contracts. Therefore, the fund will be less vulnerable to economic cycles and produce stable dividend incomes.”