EISER Infrastructure Partners has completed the management buyout from Fortis Investments of the general partner of the fund formerly known as ABN Amro Global Infrastructure.
When Fortis suffered massive write-downs at the end of 2008 on account of the US sub-prime crisis, the Belgian and Luxembourg governments asked French bank BNP Paribas to take over Fortis, and the fund found itself part of BNP Paribas.
Hans Meissner, chief executive of the rebranded fund, says the buyout was done in a friendly manner, with BNP Paribas remaining an investor in the fund and a member of the fund’s advisory board.
“We were motivated to be independent for quite some time,” Meissner says. “It’s good to have the guiding hand of a parent sponsor but that sometimes creates conflict over the type of investments we want to make. When we were bought by BNP Paribas, they ended up having two infrastructure funds [the other being Antin Infrastructure Partners]. Several possibilities were discussed, including merging the two, and in the end, BNP Paribas offered us the possibility to do the buyout.”
EISER Global Infrastructure Fund manages eight investments – seven in Europe and one in Australia – worth over €3 billion. Meissner says the fund is 75 percent-invested and expects to commit the rest of its capital by the end of this year. The fund has 19 institutional investors – said to include the likes of Abu Dhabi Commercial Bank and AP Fonden III, the third Swedish National Pension Fund – which strongly supported the buyout, Meissner said.
EISER is in the process of launching a second infrastructure fund targeting a similar size to the existing fund and investing along the same lines. But is a €1 billion final close too ambitious given that the likes of ING and Santander abandoned their plans to launch infrastructure funds targeting similar amounts last year?
“It’s true that fundraising is a difficult market at the moment,” Meissner admits. “But we have an existing investor base and we are confident that we can reach that number. We are also very much an OECD fund, which carries less risk. That’s not to say there aren’t interesting opportunities in emerging markets. The problem is that the legal framework is sometimes shaky.”
BNP Paribas is looking to invest €100 million in the new fund, though it will no longer be a parent sponsor, EISER said in a statement. Fortis Investments will allow the fund to maintain its offices and will allow it to continue using its IT services for the next year, to ensure a smooth transition, the statement read.