Amundi Private Equity Funds has launched a new infrastructure fund targeting €600 million, as it looks to capitalise on the growing interest in the market.
The Paris-based manager has launched the Amundi Infrastructure Diversified Fund I, which will invest 60 percent of its capital in funds and 40 percent in co-investments, Guy Lodewyckx, head of private markets multi-management at Amundi, told Infrastructure Investor. About 40 percent of the fund will be invested in energy including renewables, with the remainder reserved for telecoms and transport. Roughly 60 percent will be invested in the core and core-plus space and 40 percent in value-add.
The new Europe-focused fund is aiming for a net IRR of 8-10 percent and a cash yield of 4-5 percent. The vehicle does not have a hard-cap, Lodewyckx confirmed, and is being marketed to European investors still getting used to the asset class.
“We have been investing in infrastructure for 12 years for very large institutions but we also know that many smaller institutions want to increase exposure to infrastructure,” Lodewyckx explained. “We know how to do that, we’ve been doing that for years for large institutions and we want to make the strategy available to these new clients.”
The dual strategy of fund and direct investments will enable Amundi to manage risk and increase diversification, he added.
“One crucial factor when investing in infrastructure is diversification. If you invest in one sector or one country, if there is a change in regulation, your fund is likely to suffer,” he said. “With our strategy, we will invest in 6-10 funds and 6-8 co-investments and have about 100 different assets in the portfolio.”
Lodewyckx stressed that Amundi will be selective when investing in funds and highlighted the importance to the firm of demonstrative performance.
“We don’t buy stories, we buy facts,” he said. “We mainly look at GPs with strong track records. We think there is a lot of value in the quality of our relationship with GPs, when we are happy with them, happy with their performance and also happy with the co-investment opportunities they send.”
The launch of Amundi Infrastructure Diversified Fund I is the second Amundi infrastructure vehicle launched in recent months. In June, the group launched Amundi Energies Vertes alongside Crédit Agricole Assurances to invest in European renewables. Last month, the fund launched a dedicated platform with the JPMorgan-owned renewables manager Sonnedix, as well as investing €50 million in Sonnedix’s existing asset base.