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S. Korea's sovereign fund in talks to buy stake in LA Dodgers: sources

All Headlines 15:10 March 30, 2015

SEOUL, March 30 (Yonhap) -- South Korea's sovereign wealth fund is pushing to buy a stake in the Los Angeles Dodgers, a Major League Baseball team, as part of a broader move to diversify its investment portfolio, according to sources familiar with the matter Monday.

The Korea Investment Corporation (KIC), which manages assets entrusted by the South Korea's central bank, has been in talks to buy a 19-percent stake from U.S.-based investment firm Guggenheim Partners, a deal estimated at over 400 billion (US$361.9 million), multiple sources said, asking for anonymity due to the ongoing process.

The LA Dodgers, which had won the World Series six times, are hugely popular among South Koreans as Korean-born star pitcher Ryu Hyun-jin has been playing in the team, following ex-Dodger Park Chan-ho, the first Korean to enter the American major league in 1994.

The deal includes sharing profits from admissions and broadcasting rights with Guggenheim Partners and a guarantee for an annual return rate of over 3 percent, they noted.

Following CEO Hank Ahn's visit to Dodger stadium in January, KIC has approved the investment plan earlier this month and dispatched a group of its staff to LA to negotiate the deal.

But market watchers questioned the sovereign fund's possible investment in the American baseball team, which has been suffering red figures over the past years and plans to spend big on mass renovation of its stadium, the third-oldest major league park in use.

"Sovereign wealth funds usually invest in overseas assets, which could entail various risks," said Song Hong-sun, a researcher at the Korea Capital Market Institute, a Seoul-based think tank. "KIC would have to more cautiously analyze related risks as it is investing with public money."


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