Exclusive: Westbourne to launch fresh fundraise in H2

The Melbourne-based fund manager will aim to collect up to $3bn for junior and senior debt investments across OECD markets.

Westbourne Capital, the Melbourne-based infrastructure debt fund manager, is preparing to launch a new fundraising effort in the second half of this year, Infrastructure Investor has learnt.

It is understood that the firm will be looking to collect between $2 billion and $3 billion for investments in both junior and senior debt, largely from existing investors but also from a few new clients.

The money will go towards a combination of co-mingled funds and separately managed vehicles, sources said, with the former targeting smaller investors. The latter, aimed at limited partners (LPs) with greater firepower, will also be structured as closed-ended accounts.

Return targets and management fees will depend on the strategy chosen, with senior debt commanding lower fees and returns in line with investments in BBB-rated debt, which typically yield 150 to 200 basis points above benchmark interest rates.

Performance targeted for junior debt investments will vary depending on their respective risk profile, with expected returns for single assets ranging anywhere between 4 percent and 8 percent.

The funds, which will continue to target OECD markets, could rebalance towards the US as opportunities arise from disruptions in North America’s energy markets, sources said. Westbourne has historically been more focused on Europe, where about 70 percent of its investments are said to have been made.

Westbourne declined to comment.

Eighteen months ago the firm raised $1.5 billion for investments in junior debt, half of which has now been invested. It is expected the other half will be deployed by the end of the year.

The firm counts about 30 LPs, including three large sovereign wealth funds and a clutch of insurance groups. It is 80 percent owned by its management, following a transaction that saw it sell 20 percent of itself to Tokyo-headquartered Mitsui & Co last May.

The move, intended to deepen its relationships with local clients, came 12 months after both firms launched a $300 million infrastructure debt fund exclusively for Japanese institutional investors.

The capital raised by Westbourne this time around will continue to target investments in sectors including transport, energy and telecoms. Deals will take the form of acquisition facilities, refinancings and support for greenfield projects.

It is understood that the firm is looking to back prospective participants in auctions for Lyon and Nice Airports in France, as well as the ports of Melbourne and Fremantle Down Under.