Goldman to launch infrastructure fund

The investment bank will take on Australia’s Macquarie Bank in the increasingly popular area of infrastructure investments, according to press reports.

Goldman Sachs is to become the first global investment bank to launch a dedicated infrastructure investment fund, according to a report in The Times. The bank is seeking to raise £3 billion (€4.4 billion; $5.3 billion) to target global investments.

The move will put Goldman Sachs directly into competition with Australian bank Macquarie, which launched its Macquarie European Infrastructure Fund (MEIF) in April 2004. MEIF closed oversubscribed in July 2005 after reaching its cap of £1.5 billion.

Demand for infrastructure funds has been driven by access to low volatility income streams and government initiatives to drive private money into public services such as education, health and transport.

However, there are still few funds targeting infrastructure assets currently in the market.

In October, Henderson Private Capital held a final close of its oversubscribed Henderson PFI Secondary Fund on £330 million, exceeding its initial target size of £200 million. UK-based infrastructure fund I2 closed in June on £450 million, with £150 million in commitments from 3iBarclays Private Equity and SG Corporate & Investment Banking.

Another player in the UK market, Star Capital Partners, is believed to be currently in the market to raise around £600 million of fresh capital. The firm raised €581 million for its debut fund in 2001.

In separate news, Goldman Sachs has promoted 209 members of staff to managing directors from November 26, the start of the firm’s fiscal year.