The European Bank for Reconstruction and Development (EBRD) is investing $100 million in the Macquarie Renaissance Infrastructure Fund, the first infrastructure fund to specifically target projects in Commonwealth of Independent States (CIS) member countries.
Those countries include the 12 former Soviet Socialist Republics such as Russia, Kazakhstan and Ukraine.
EBRD already has cumulative investments in Russia, Kazakhstan and Ukraine of around $4.5 million.
The fund was launched in June last year, with Vnesheconombank, the Russian state-owned bank, committing $200 million as one of the fund’s cornerstone investors. The International Finance Corporation, part of the World Bank, has also committed $100 million. The Eurasian Development Bank, as the fund’s strategic partner in the CIS region, has committed $200 million, with Kazyna Capital Management, the fund’s Central Asian partner, contributing $50 million.
Founding partners Macquarie Group and Renaissance have each committed $50 million to the fund.
The fund will allocate at least half of its total commitments to investments in Russia, with no more than 25 percent of its commitments being devoted to any one CIS country. The majority of the fund’s non-Russian investments will target Ukraine and Kazakhstan. The EBRD said that while the fund will target a range of infrastructure, transport assets are likely to represent the majority of the fund’s investments.
The fund features a fee structure of 2 percent management fee and 20 percent carry, according to a person who has seen its marketing materials.
The fund’s target size is around $1 billion, according to the EBRD. The fund’s marketing materials indicate that it may seek up to $1.5 billion, according to the person.