Challenger-Mitsui holds first close on $238m

The pan-emerging markets infrastructure fund, which is aiming for a final close in June 2010, secured commitments from nine investors, including the Japan Bank for International Cooperation.

The Challenger-Mitsui Emerging Markets Infrastructure Fund, a joint venture between Australian asset manager Challenger Financial Services Group and Japanese trading house Mitsui, has raised $238 million for its first close.

The Asian infrastructure-focused fund aims to reach a final close on $650 million in June 2010, said Andrew Jones, joint managing director of the fund.

Thus far, the fund has garnered commitments from nine investors including Japan Bank for International Cooperation and a Japanese trust bank, according to the Challenger statement. Mizuho Corporate Bank, Challenger, Mitsui & Company and Access Capital Advisor, a firm acting on behalf of four Australian pension funds, provided the fund’s seed capital in June 2008.

Presently, the firm is working on a deal in Asia, which it aims to close in January or February next year, Jones said.

In February, Jones told InfrastructureInvestor that the fund was refocusing its investment strategy on Asia. It had originally targeted investments across a broader range of emerging economies in Asia, Africa, South America, Russia and the former Soviet Republic.

“Many Asian countries are benefiting now from reforms they introduced after the Asian currency crisis of 1997. More open governments and better managed economies with large foreign currency reserves make them particularly attractive for infrastructure investments,” he said at the time.

The fund had previously invested $80 million to two gas distribution companies in Chile: Gas Valpo and Energas. It currently holds a 51 percent stake in the assets, which have been merged. The remaning 49 percent of these assets are owned by the Australian pension funds, which are investors in the fund.

The fund targets 70 percent of its investments in the Asia Pacific economies of China, India, Thailand, Vietnam and Indonesia. All are countries where joint venture partner Mitsui has offices.