CPG Partners, Tianjin to raise $500m infrastructure fund

The CPG Tianjin Infrastructure Fund will invest in toll roads in Tianjin and Tangshan.

Singapore-headquartered CPG Capital Partners has teamed up with China’s Tianjin government to set up the CPG Tianjin Infrastructure Fund, which aims to raise $500 million by February 2010.

CPG and the Tianjin government will each commit $50 million to the private equity fund while other domestic investors will commit between 10 percent and 20 percent of the targeted fund size, Stephen Hawkins, CPG’s head of funds management, told sister publication PEI Asia. The fund is also targeting international investors from North America, Europe and Asia, he added.

The fund will focus on acquiring toll roads in Tianjin and Tangshan, a city to the east of Tianjin, in addition to developing one greenfield infrastructure project, Hawkins noted. The firm is looking to invest about $100 million in equity for each toll road and between $100 million and $200 million for the infrastructure project, he added.

CPG, which is currently working closely with the Chongqing government, aims to replicate the Tianjin partnership with five to six governments over the next five years. The firm is also raising a second fund, which is targeting $1.5 billion and looks to close in the first half of 2010, Hawkins said.

“We plan to develop the portfolio across other sectors such as power and water in the future,” he added.

CPG Capital Partners is an investment banking and funds management firm which typically invests in government-backed infrastructure and real estate assets.

The firm has offices in Singapore, Beijing, Shanghai and Sydney as well as management teams in Tianjin and Tangshan.