IDFC hits $900m hard cap

Mumbai-based fund manager IDFC Alternatives has raised $810m from third-party LPs for its Fund II.

IDFC Alternatives, the Mumbai-based fund manager, has announced the final closing of its second infrastructure fund – India Infrastructure Fund II (IIF II) – on its hard cap of $900 million.

The total amount raised includes $810 million from third-party limited partners (LPs) as well as $90 million from parent company IDFC Limited. No specific LPs have been named, but a statement said they included global institutional investors from North America, Europe and the Middle East.

IIF II is the successor to IDFC Alternatives’ debut infrastructure fund – India Infrastructure Fund (IIF) – which closed on $927 million in June 2009. That fund is now fully committed.

“We are very pleased with the high quality and marquee investors that IIF II has attracted and are proud of the speed with which IIF II has been subscribed to, especially given the difficult economic and financial conditions that prevailed during the majority of our fundraising period,” said MK Sinha, managing partner and chief executive officer of IDFC Alternatives, in a statement.

Aditya Aggarwal, an infrastructure partner at the firm who co-led the fundraise, said fund two would have a “similar” investment strategy to fund one involving both under-construction and operational core infrastructure assets in India.

While various regulatory and bureaucratic issues – as well as underwhelming economic performance – have hampered the development of the infrastructure market in India, hopes are high that it will be kick-started under the new Modi regime.

IDFC Alternatives is one of the largest alternatives fund managers in India with $3.4 billion under management. Founded in 2002, it has seven India-focused funds across private equity, infrastructure and real estate managed by 34 investment professionals.