AMP Capital closes GIF II on $3.4bn

Having raised $1bn more for GIF II than its predecessor, AMP Capital will seek to acquire 100% of assets when investing its latest fund, a spokeswoman for the Australian fund manager said.

AMP Capital has closed Global Infrastructure Fund II on $3.4 billion, exceeding its $3 billion target, thanks to more than 60 institutional investors from Europe, North America, the Middle East and Asia-Pacific.

The Australian fund manager reached final close on 27 December, it said on Monday.

“This landmark close for GIF II is a significant step in the global growth of our infrastructure business, and our investments to date show we’re delivering on our broader strategy of delivering growth through real assets,” AMP Capital’s global head of infrastructure equity Boe Pahari said.

GIF II, which is the successor to AMP Capital’s Global Infrastructure Platform that closed on $2.4 billion in January 2017, targets a gross IRR of between 12 and 15 percent and a gross cash yield of 4-6 percent, according to a quarterly report AMP Capital published in September 2019.

“The global infrastructure equity strategy has not changed,” a spokeswoman for the firm told Infrastructure Investor.  But, “the larger fund size means there’s a preference to seek 100 percent ownership of assets where possible”, she added.

As for ticket size, GIF II targets mid-market transactions with a total equity value of $100 million-$750 million in Europe, North America and other OECD countries, in the transport, communications, healthcare and energy sectors.

The firm has already invested in five assets across all four sectors, through Fund II. Two of these are in the UK: London Luton Airport, in which AMP Capital acquired a 49 percent stake in April 2018; and specialist care provider Achieve Together, which resulted from the merger of the Regard Group and Care Management Group.

In the US, AMP Capital acquired US fibre-optic internet developer, Everstream Solutions committing more than $200 million in equity; it partnered with US clean energy developer Invenergy to create Invenergy AMPCI Thermal Power, a 50/50 joint venture that will invest in gas-fired power-generation; and in December it reached financial close on a deal that saw it acquire Expedient, a provider of cloud computing and data centre services. Though AMP Capital did not disclose financial details of that transaction, it said it was its largest infrastructure equity investment in North America to date.

The fund is more than 50 percent deployed, according to the spokeswoman. “We expect a portfolio of around 10-12 assets diversified by sector and geography,” once the fund is fully invested, she said.

The close of GIF II comes three months after AMP Capital finished raising its largest closed-ended fund, Infrastructure Debt Fund IV, which closed on its hard-cap of $4 billion.