Fundraising

China Everbright closes overseas infra fund on $450m

Despite having lowered its target twice, the Chinese asset manager claims the vehicle has reached ‘the right size’.

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Hong Kong-listed China Everbright has reached final close on its OECD-focused infrastructure fund on approximately $450 million after receiving a commitment from South Korea’s ABL Life Insurance, the Chinese asset manager said.

The Everbright Overseas Infrastructure Investment Fund, launched in 2017, closed significantly below its initial target of $1 billion. It also closed below a lower target of $600 million, the asset manager set in April, citing Asian investors’ “preference for debt-like products” and the fact this was the firm’s first overseas infrastructure fund.

Despite this, China Everbright’s chief financial officer, Richard Tang, argued the vehicle reached “the right size” considering the “mixture of assets in its portfolio”.

“The inclusion of ABL as an investor showcases that our fundraising capability spans beyond the Greater China region,” Tang said.

He did not disclose the amount committed by ABL, or whether the vehicle has received support from other LPs in recent months. A representative from ABL did not immediately reply to a request for comment.

The only other LP known to have invested in the fund is China Life Insurance, which has committed $100 million, according to Infrastructure Investor data.

The overseas fund has invested in Albania’s Tirana International Airport; Norwegian public transport operator Boreal Group; and Village Telephone, an optic fibre network in Hong Kong.

The eight-year vehicle is targeting a net IRR in the mid-teens by investing in OECD countries.

Tang said China Everbright is planning to launch a new infrastructure-focused fund during the first half of 2020, but declined to provide more details.

In January, Hong Kong’s South China Morning Post reported that China Everbright is also planning to launch a Silk Road Fund to invest in aircraft leasing and related infrastructure, such as airports and logistics parks in the countries that are part of China’s Belt and Road initiative. In 2011, the asset manager bought a 40 percent stake in China Aircraft Leasing Company, which currently owns a fleet of 137 aircraft.

China Everbright manages 64 funds, primarily focused on alternative assets. Its AUM stands at HK$145.4 billion ($18.5 billion; €16.7 billion).