Australia’s ICG in A$1bn fundraise

The Sydney-based manager is seeking extra funding for mid-market deals spanning transportation, utilities and renewables.

Australia's Infrastructure Capital Group has set a new and higher target to raise A$1 billion ($781 million; €692 million) from domestic and international institutional investors for mid-market infrastructure deals. 

Last November, Infrastructure Investor reported that the firm was working towards a fundraise target of A$600-800 million, of which it had raised about A$160 million. 

The capital will be deployed across ICG’s A$450 million Diversified Infrastructure Trust and A$1.1 billion Energy Infrastructure Trust fund, as well as separate accounts for institutional investors. 

Peter Welch, ICG’s head of capital, said he witnessed a growing interest from investors for bespoke exposures and partnership programmes.

“Investors vary in how they want exposure to infrastructure, with some requiring resourcing and a full service, while others seek more asset control.  Our business is about successfully partnering with clients to offer tailored structures and service according to their preferred level of active engagement,” he added. 

The firm believes fair value in the mid-market to be driven by asset recycling programmes, strained government and corporate balance sheets, non-core divestments from corporates, and steady organic growth opportunities, according to Andrew Pickering, ICG’s chair. 

“There are assets out there that are reasonably priced, with more coming to market, particularly in the renewables space,” he said in a statement. 

“We don’t wait for all deals to come to market, we originate deals from the idea stage and work with development partners to structure them for commercial close. In the longer term, our investors and their members benefit from de-risking, growth, and enhanced returns throughout the asset’s lifecycle.” 

With over A$1.5 billion under management, ICG has invested in 24 infrastructure assets. Recent transactions include Port Hedland International Airport, in partnership with Australian fellow AMP Capital, and the Hallett 4 wind farm in South Australia.