DIF closes second fund above target with €571m

DIF Infrastructure has closed its second infrastructure and renewable fund on €571 million, beating its original target of €500 million after about 20 months of fundraising.

It has managed to raise almost €300 million over the last seven months, after having held its last close in late January at €275 million.

The fund, which launched in October 2008, has already made more than €275 million of investments. DIF, which has offices in Amsterdam, London, Paris and Frankfurt, is looking to invest in public-private partnerships and renewable energy projects with moderate risk profiles through DIF II. The fund also has invested in 12 onshore wind projects in France and Germany, two solar projects in France and 18 public-private partnership projects.

DIF II’s limited partners are mostly European institutional investors including the European Investment Bank, Dutch pension asset manager APG, Swiss alternative asset manager Partners Group and Dutch life insurer Achmea.

DIF’s first fund, called Dutch Infrastructure Fund, collected about €121 million in 2006. The firm also raised a renewable energy fund that closed on €134 million in 2008. Fund II officially closed in July.

Atlantic-Pacific Capital worked as placement agent for the fundraising.

During the fundraising, DIF was able to acquire stakes in several projects “at attractive prices” and “provided in many cases an immediate cash generation for the fund”, a source with knowledge of the fund told PEO.

In July, DIF acquired an 11.7-megawatt tranche of EDF Energies Nouvelles’ potential 76-megawatt Gabardan solar PV project in the south of France for an undisclosed amount.

DIF secured some new limited partners to the roster, though the firm declined to comment on specific details. Most LPs in the fund are based in Europe, “where there is a healthy appetite for the asset class” and also investors who are “familiar with the PPP/PFI model”, the source said.

The fundraising was no easy feat as LPs who were looking to commit to the fund “chose to undertake a sizable amount of due diligence”, the source said. Also, “there are a large number of funds now competing for capital and obtaining commitments from investors remains hugely competitive”.