Actis eyes $700m-plus first close on debut infra fund – exclusive

The firm – which had previously raised four energy funds targeting greenfield and development project – hopes to reach a final close on the $2bn vehicle by year end.

Emerging markets investor Actis expects to reach a first close on over $700 million for its debut infrastructure fund in May, a source familiar with the fundraising confirmed to Infrastructure Investor.

The source said Actis is on target to hold a final close on the fund’s $2 billion target by the end of the year, after launching the vehicle last September. The May first close will end a discount period for early investors that offers a 15-basis point fee reduction.

Actis is raising an infrastructure fund that will target operating power, transmission, generation and distribution assets in Africa, Latin America, Southeast Asia and India. Over 10 limited partners, mostly pensions and insurance companies, are doing due diligence on their commitments, which range between $50 million and $200 million, the source said.

The vehicle is different from its four previous energy funds – the last of which closed on $2.75 billion in March 2017 with the bulk of commitments coming from US institutional investors – which invested in greenfield and development projects.

Actis declined to comment for this story.

In a previous interview with Infrastructure Investor, Glen Matsumoto, partner and head of infrastructure at the firm, explained developing markets are now offering a steady supply of brownfield opportunities:

“Assets in growth markets are now at a different stage of risk. If you look back over the past 16 years, there has been about $1.3 trillion of greenfield investment made by the private sector in growth markets globally and those assets are now operational with a track record of successfully performing for their private sector investors. Investors that are looking for defensive infrastructure investments with a long-term, reliable, stable contracted cashflow profile, now have a significant and growing investment opportunity in growth markets.”

In January, the firm acquired a 110MW solar project in Chile that will be used to power Santiago’s underground subway system. The deal seeded Actis’ infrastructure fund with a portfolio of clean energy assets.

Since final close of the firm’s fourth energy fund, the firm has pledged over half of its capital to projects in Africa and Latin America. It has launched two renewable energy platforms in Latin America: a vehicle operating 578MW of solar projects and 1GW of early-stage developments; and a Brazil-focused wind platform seeded with two projects generating a combined 346MW.

In 2009, the firm closed Actis Infrastructure 2 on $750 million, but that fund still had an energy and power focus and is considered a predecessor to Actis Energy 3, which closed on $1 billion in 2013.