EQT in €1.9bn fund close

Stockholm-based fund manager EQT has closed its second infrastructure fund in an oversubscribed fundraise with demand surpassing its €1.9 billion hard cap, sources familiar with the process told Infrastructure Investor. They say that, without the cap, the fund could have raised around €2.2 billion.

EQT was originally targeting €1.5 billion for Fund II. But market demand led the fund manager to put in place a €1.9 billion hard cap. In the end, EQT II was oversubscribed by €700 million in relation to its €1.5 billion original target, sources said.

The Swedish fund manager took less than a year to raise Fund II and just six months last year to amass €1.1 billion. In the interim, it has been actively investing the money raised.

Late last year, EQT II launched a public tender offer to acquire Nasdaq-listed Westway Group, a bulk liquid storage provider. The deal is valued at $419 million, or $6.70 in cash per common share.

EQT has existing exposure to the storage sector. In June 2011, it acquired a majority stake in Argos Terminals, the storage and terminals business of Rotterdam-based oil and energy company Argos Group.

Also last year, EQT Infrastructure Fund II purchased 51 percent of E.ON Energy from Waste, a leading European energy-from-waste company.

EQT already runs a €1.2 billion infrastructure fund, closed in 2008. In the fall of 2012, EQT sold its first investment from Fund I – a natural gas fired, combined cycle cogeneration outfit in the US known as Midland Cogeneration Venture (MCV) – to Borealis. Terms of the deal were not disclosed at the time, but sources suggest EQT netted an internal rate of return of around 40 percent.