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Australia’s Blue Sky secures LGIAsuper mandate

The Brisbane-based firm has enlisted the A$10bn pension as an investor after selling a water utility to Colonial First State last month.

Blue Sky Alternative Investments has expanded its assets under management by signing “a significant investment mandate” with a large Australian institution.

The mandate from LGIAsuper will be deployed across the firm’s real assets portfolio, which includes Australian water assets, agribusiness private equity and agricultural infrastructure, the asset manager said in a filing at the Australian Stock Exchange. 

LGIAsuper is the superannuation scheme for Queensland’s local government employees and their spouses, with nearly A$10 billion ($7.55 billion; €7 billion) in assets under management. The fund has invested in renewable power generation assets in Japan, Australia and India; gas pipelines in Australia, the US and Spain; seaports in Australia and Canada; and bulk liquid storage in Europe and the US. Its portfolio managers include EQT, Equis Funds Group, I Squared Capital, Morgan Stanley and Palisade Investment Partners, according to the super fund’s website. 

Blue Sky declined to disclose the mandate size. 

The firm currently manages several real assets funds, one focused on the water sector and two on agricultural assets. The Water Fund has a target IRR of 10-14 percent, while other real assets are expected to post returns of 15 percent on average, according to an ASX filing. 

Last month, the firm completed the sale of Water Utilities Australia Group, a business which invests in micro water utilities in Adelaide, to Australian fund manager Colonial First State Global Asset Management for an undisclosed amount. The firm held the stake through its Water Utilities Australia funds. 

Water Utilities Australia Group owns two assets – Willunga Basin Water Company and Lightsview ReWater. “Attractive opportunities have not been available and accordingly the manager has elected to sell WUG in order to focus on other strategies in real assets,” said the firm in a filing. 

First State acquired WUA through its Global Diversified Infrastructure Fund, appointing Graham Dooley as the chief executive and director of the fund. Dooley had been the chairman of the fund, in addition to chairing industry body Australian Water Association, prior to joining First State from Blue Sky.