Bridgepoint Group, a boutique Canadian investment banking, consulting and private equity firm, has launched a greenfield-focused energy and infrastructure fund.
“We think that is where you get the highest return for your money,” Bridgepoint president Frank Carnevale said in an interview. He added that the fund will seek to raise between C$5 million and C$15 million from high-net worth individuals. The fund will not target the institutional market.
The fund will seek equity positions in power generation and social infrastructure projects “where a creditworthy government or quasi-government counterparty” will provide payments for the power or services provided, according to the statement. An internal rate of return of 15 percent is expected from such investments, Carnevale said.
Across Canada, several provinces, including Alberta, British Columbia and Ontario, have government programs that help facilitate private investment in the development of their social infrastructure. For example, Alberta recently awarded a contract to German infrastructure developer Hochtief to design, finance, build and maintain ten new schools.
Besides developers like Hochtief, there are some fund managers, such as Paris-based Meridiam Infrastructure, who are willing to invest in development-stage assets. But aside from a few others, like AXA Private Equity and the London-listed HSBC Infrastructure Company Limited, there are not many fund managers willing to provide development-stage capital to infrastructure projects.
Such funds, however, have significantly more heft and typically target the institutional market for their commitments.
Bridgepoint said it was a timely moment to raise the fund because Canada’s infrastructure deficit is projected to climb to $1 trillion by 2050.
Based in Toronto, Bridgepoint was established in 1998. Its private investment arm, Bridgepoint Asset Management, specialises in sustainable energy and infrastructure across the US and Canada.
The Greenfield Development Fund I is going to be the first fund managed by Bridgepoint. Carnevale hopes to finish fundraising this summer and hopes to launch a follow-on fund within 30 to 40 days of the final close of the first fund.