First State collects €1.3bn for Europe fund

The Sydney-based investment manager has raised more than €600m over the last 6 months, bringing it close to its €1.5bn target.

First State Investments International, the investment arm of Australia’s Commonwealth Bank, has secured €1.279 billion of commitments for its European Diversified Infrastructure Fund (EDIF). 
 
The vehicle, which has a target size of €1.5 billion, has attracted more than €600 million since last March. The fund is still seeking further commitments from LPs, First State told Infrastructure Investor on Thursday. The firm expects to reach a final close next year. 
 
Launched in 2007 as an open-ended fund, the vehicle became a hybrid structure in 2009, when First State started seeking commitments from institutional investors. The vehicle now operates as a closed-ended fund, but investors have an option to extend their commitments in five year blocks. 
 
EDIF’s LP base comprises 20 new investors from Europe, North America and Asia, Philippe Taillardat, First State’s co-head of infrastructure investments, said in a statement. Known investors in the fund include the UK’s Pensions Trust, according to Infrastructure Investor’s Research and Analytics department.  
 
EDIF is a 15-year fund focused on unlisted European infrastructure assets in the utilities, transportation and public services sectors. It targets low-risk investments with an internal rate of return of between 10 and 15 percent and cash yields of 5 to 7 percent per annum. 
 
The fund has already deployed €568 million in four core operating assets, including Anglian Water Group, the UK’s fourth-largest sewerage service provider; Electricity North West Limited, the sixth-biggest electricity distribution network in the UK; and Digita, the largest Finnish broadcast tower operator.
 
As at 30 June 2013, EDIF posted total net annualised returns of more than 14.9 percent, including annualised cash returns of 6.4 percent.