APG helps Macquarie’s Philippines fund close on $625m

The Philippine Investment Alliance for Infrastructure, the country’s first-ever infrastructure fund, has closed on $625m backed by the Philippine’s largest pension fund, Dutch pension provider APG, the Asian Development Bank and Macquarie Infrastructure and Real Assets. The latter also manages the fund.

The Philippine’s first-ever private equity fund for infrastructure investments has reached a first and final close on $625 million, Macquarie Infrastructure and Real Assets (MIRA), which manages the vehicle, announced in a statement today.

“It’s all systems go and the fund is now open for business,” enthused Robert G. Vergara, the president of the Government Service Insurance System (GSIS), the Philippines’ biggest pension fund and the lead investor in the Philippine Investment Alliance for Infrastructure (PINAI), as the $625 million vehicle is known.

Alongside the GSIS, the fund’s other investors include the Asian Development Bank, the Netherlands’ largest pension services provider – APG – and fund manager MIRA. The size of the limited partners’ contribution was not disclosed, but earlier reports in Reuters suggested GSIS was contributing $300 million for the vehicle with MIRA chipping in some $50 million.

“PINAI provides for an excellent investment opportunity and we expect it to enjoy an early mover advantage and to generate attractive risk-adjusted returns for our clients: pension funds in the Netherlands with combined assets of over €300 billion,” commented Hans-Martin Aerts, head of infrastructure Asia at APG Asset Management, in Hong Kong.

PINAI will invest equity and “equity-like instruments” both in infrastructure businesses and projects in the Philippines, focusing on both brownfield and greenfield assets across transport, power, renewable energy, water and telecommunication infrastructure, MIRA explained. 

The fund will focus on five to 10 investments and is prepared to write cheques of between $50 million and $125 million for each of the assets, the Asian Development Bank added.

Vergara believes that “with the combined global financial strength of our partner-investors, plus Macquarie’s proven track record as a pre-eminent infrastructure manager, the PINAI will be fully deployed within its investment horizon of three years”.

The Philippine government is planning to launch at least eight public-private partnership projects this year, including new airports, an expressway and a water project. The deals are said to be worth a total of PHP130 billion (€2.5 billion; $3.1 billion).