II Awards 2018: Global winners

I Squared, AMP Capital, Brookfield and OTPP are among the winners in our global category.

1. Sadek Wahba (I Squared Capital)
2. David Russell (Equis)
3. Angela Miller-May (Chicago Teachers’ Pension Fund)

To appreciate the full extent of I Squared Capital founder and managing partner Sadek Wahba’s achievement, you have to remember the firm didn’t exist six years ago.

Fast-forward to 2018, and I Squared is managing a tidy $13 billion in assets under management, employing 110 people in seven offices across the globe. What’s more, with its recently closed $7 billion second infrastructure fund, I Squared managed to clinch one of the biggest fundraisings of 2018, closing well above its original $5 billion target.

“The fund is already 24 percent invested with portfolio companies in the US midstream sector; the leading trailer and trailer services provider in Europe and Canada; the second-largest telecom fibre network in Hong Kong; and nearly 3,400MW of power generation in nine countries across Latin America,” Wahba said when Fund II closed.

Not bad for a firm that had started off by raising one of the largest debut funds in the history of the asset class, when it closed 2015’s $3 billion ISQ Global Infrastructure Fund. For ex-Morgan Stanley executive Wahba, it’s very much a job well done.

1. I Squared Capital
2. Macquarie Infrastructure and Real Assets
3. Partners Group

No surprises here, really, considering that I Squared was responsible for one of the biggest fundraises of 2018 with its $7 billion sophomore infrastructure vehicle. The latter beat its initial target of $5 billion, collecting commitments from more than 100 institutional investors in North America, Europe, Asia, Australia and elsewhere.

It lost little time in investing that nice chunk of change, with 24 percent of the vehicle already deployed by the time of its September final close. Fund II deals include the acquisition of TIP Trailer Services, a European and Canadian trailer leasing and services company; some 3,000MW of power-generation assets in nine countries across Latin America; Hong Kong-based fibre internet company HGC Global Communications, the territory’s second largest; and US-based Pinnacle Midstream. The stage is set for a busy 2019.

1. Ontario Teachers’ Pension Plan
2. Canada Pension Plan Investment Board
3. CDPQ Infra

A year of change for OTPP, with new head of infrastructure Dale Burgess, who has spent 22 years on the Canadian retirement fund’s investment team, officially becoming head of infrastructure and natural resources in May after taking over interim duties for the group in February 2018.

Burgess took the reins of an infrastructure portfolio worth C$17.2 billion ($12.9 billion; €11.5 billion), amounting to 9 percent of the Canadian pension fund’s C$193.9 billion as of 30 June 2018.

With new leadership in place, two stand-out deals are worth mentioning. In late May, shortly after Burgess’s official appointment, OTPP teamed up with Partners Group and CDPQ to buy German energy metering group Techem from Macquarie, in a deal with an enterprise value of €4.6 billion.

The following month, the pension sold a 37.5 percent stake in GCT Global Container Terminals to IFM Investors and a 25 percent stake to British Columbia Investment Management Corporation, forming a management partnership with them and keeping a 37.5 percent stake for itself.

1. I Squared Capital
2. Stonepeak Infrastructure Partners
3. KKR

It’s not by accident that the ‘Holy Trinity’ of managers – 2018’s $7 billion club – make up the positions for our Equity Fundraising of the Year, Global category. Yet the market chose to reward I Squared’s second vehicle as the year’s fundraise.

The final close arrived 16 months after the Miami-based firm launched ISQ Global Infrastructure Fund II. I Squared beat its initial target of $5 billion, collecting commitments from more than 100 institutional investors in North America, Europe, Asia, Australia and elsewhere.

Founding partner Adil Rahmathulla told us at the time the firm garnered much interest from US LPs, adding “US investors are getting much more comfortable investing in infrastructure”. US investors committed to the fund include the North Dakota State Investment Board ($140 million), the Washington State Investment Board ($250 million) and the Texas Municipal Retirement System ($150 million).

Asia was another market from which I Squared saw greater interest, Rahmathulla pointed out. All seems set fair for Fund III then.

1. Brookfield Asset Management
2. Macquarie Infrastructure Debt Investment Solutions
3. Schroders

Third time’s a charm? Try first. That’s the story of Brookfield’s first debt vehicle – The Brookfield Infrastructure Debt Fund I – which held a final close on $885 million last January, backed by a diverse group of institutions including pension funds and financial groups.

Launched in 2016 with a $700 million target, the debut fund will focus on mezzanine debt investments in core infrastructure assets, primarily in North America, but will also invest in South America, Australia and Europe.

By final close, the fund had already made several investments in infrastructure debt covering transportation, renewable power and energy worth about $200 million.

“We are pleased to leverage our extensive infrastructure and credit expertise into high quality infrastructure debt investments that offer attractive, risk-adjusted returns,” Sam Pollock, senior managing partner and head of Brookfield’s Infrastructure Group, said at the time. This award shows the market is also pleased with Brookfield’s debt efforts.

1. Allianz Global Investors
2. MetLife

Once again, AllianzGI finds itself the winner in this category after a year filled with milestones. It completed the first four transactions from its Resilient Credit strategy, a medium-term secured-lending play the firm launched in 2017 that is “more suited to shorter investment horizons”.

Those four transactions – across a number of sectors, including water, oil storage and airport services – helped the Frankfurt-based investment manager reach another milestone as it has sealed 50 infrastructure debt deals, totalling €11.1 billion, since launching the platform in 2012.

Around the same time, in July 2018, the firm also expanded into Latin America, first by investing in the Fermaca El Encino-La Laguna gas pipeline in Mexico and then participating in the refinancing of two solar PV plants in Uruguay – El Naranjal and Del Litoral – owned by Atlas Renewable Energy.

These deals brought AllianzGI’s infrastructure debt investments in the Americas to more than $4.2 billion, with the firm promising that “more are expected to follow”.
More recently, in September, the firm added Portugal’s largest telecom towers company to its Resilient Credit portfolio, investing €150 million in debt.

1. Equis Energy (GIP, PSP Investments, CIC)
3. WestConnex (Transurban, AustralianSuper, CPPIB, Tawreed Investments)

Billed as “the largest renewable energy generation acquisition in history”, it’s probably no surprise that Equis Energy emerged as the clear winner in this category. Not only did it attract attention for its hefty $5 billion price tag, it also cast the spotlight on Asia’s renewables sector, which John Walker, Macquarie Capital’s vice-chairman for Asia, described as the “investment opportunity of the century”.

The transaction gave Global Infrastructure Partners, PSP Investments and China Investment Corporation a major footprint in the region, thanks to the more than 180 assets totalling 11.1GW in generating capacity that span seven countries.

Since the sale, Equis has been re-grouping. In October, it hired Damian Secen from Macquarie Infrastructure and Real Assets, appointing him to a newly created role where he is responsible for origination, investment and asset management.

1. Melbourne Metro Tunnel & Stations PPP (Bouygues, Lend Lease, John Holland, Capella Capital, John Laing)
2. LAX Integrated Express Solutions (Fluor, Balfour Beatty, ACS, Bombardier)
3. Navi Mumbai Airport (GVK Power and Infrastructure)

Roughly two-and-a-half years after then-Victoria Premier Daniel Andrews kick-started the “largest public transport project” in the state, the Cross Yarra Partnership reached financial close on the project, which includes a 25-year concession, in December 2017.

The A$6 billion ($4.3 billion; €3.8 billion) Melbourne Metro Tunnel Project will deliver a new rail line across Melbourne central business district, featuring two 9km tunnels and five new underground stations under an availability-based PPP model. It is the centrepiece of the Melbourne Metro project, which is estimated to cost A$11 billion.

It seems fitting that an Australian rail project would win this year’s distinction since, according to Infrastructure Partnerships Australia, major rail projects outnumbered road projects last year, “reflecting a broader shift in governments’ preference for public transport investment”.

The project marks the first step towards creating a metro-style network in Melbourne and is on track to be completed by the end of 2025.

1. VINCI Airports
2. Orsted
3. Lightsource BP

The past year saw the French airport developer grow its European portfolio again, first when it was chosen as the preferred bidder for the Nikola Tesla Airport tender in Serbia, concluding a process that lasted nearly a year. The country’s procuring agency repeatedly extended the deadline, needing more time to whittle down a list of 27 bidders.

Under the agreement, the developer will pay €501 million for the concession and invest €732 million over the course of the 25-year contract. The deal covers the financing, operation, maintenance, expansion and renovation of the existing airport terminal and runway system.

Four months later, in April, it acquired Ontario Municipal Employees Retirement System’s stake in Airports Worldwide, which added nine new hubs and three partial management contracts to its portfolio, including a 100 percent stake in Belfast International Airport, a 90.1 percent stake in Sweden’s Skvasta Airport and 100 percent of the concession to operate Florida’s Orlando Sanford Airport, its first US asset.

1. Global Infrastructure Partners
2. Partners Group
3. Copenhagen Infrastructure Partners

When talking about GIP and the energy sector, it’s difficult not to mention the New York fund manager’s leading role in the $5 billion Equis Energy deal, which saw GIP and consortium partners PSP Investments and CIC acquire a renewables platform with a significant Asia-Pacific presence. But there’s a lot more to GIP’s activity in 2018 that merits mentioning.

Last February, GIP agreed to pay $1.4 billion for NRG Energy’s US renewable energy business, including its controlling stake and 46 percent economic interest in NRG Yield, as well as NRG’s renewable energy O&M and development businesses.

More recently, in September, GIP acquired a 50 percent stake in the 1.2GW Hornsea 1 project, the “world’s largest offshore wind farm” that is being built 120km off the English coast in the North Sea. When completed in 2020, the project will span 407 square km.
The £4.5 billion ($5.9 billion; €5.2 billion) deal covers GIP’s acquisition of a 50 percent stake as well as funding 50 percent of the EPC contract to develop it.

1. I Squared Capital
2. Macquarie Infrastructure and Real Assets
3. IFM Investors

Raising one of the largest infrastructure funds in 2018 was just one of several highlights punctuating the firm’s activity in the past year. Another worth noting – which is probably responsible for not only landing the firm in the top spot in this category but its significant lead over the runner-up, was the acquisition of TIP Trailer Services – a Netherlands-based company focusing on trailer leasing, rental, maintenance and repair. The deal was the sixth investment the firm made through its $7 billion second fund, which, at time of final close, was 24 percent committed.

The past year also saw I Squared sell a 20 percent stake in Cube Highways and Infrastructure, the India-focused toll road operator it launched alongside IFC in 2014, to a consortium led by Japanese industrial conglomerate Mitsubishi Corporation. But the sale is no indication I Squared is retreating from India’s transport sector. Earlier this year, Infrastructure Investor reported that the fund manager was one of several marquee names in pre-bid talks with the Airport Authority of India for six airports the country is looking to privatise.

1. AMP Capital
2. Macquarie Infrastructure and Real Assets
3. Digital Colony

After picking up bronze in the first edition of this category last year, AMP Capital has propelled itself to the top spot following a year in the sector marked by investments from three different streams.

It began in March by reportedly investing more than $200 million in equity in Ohio-based fibre network operator Everstream Solutions, designed to serve as a platform for future acquisitions and to fund organic growth and development.

Next up was AMP’s debt platform. Its third fund, working alongside CDPQ, provided $200 million to New York-based Tillman Infrastructure, a cellular tower and telecoms company planning an expansion across the US.

A short swim across the Atlantic also saw the AMP-managed Irish Infrastructure Fund take full control of enet, the largest telecoms network operator in Ireland. The October acquisition of the 22 percent stake followed the fund’s 78 percent purchase in July 2017.

1. Evercore Private Funds Group
2. Campbell Lutyens
3. Capstone Partners

Last year, we fathomed a guess that Evercore helping to close one of the asset class’s leading funds would help propel it to new heights. It appears we were right, with the placement agent landing in first place for a second year in a row. The New York-based firm served as exclusive global placement agent for I Squared Capital, helping the infrastructure fund manager raise $7 billion for its sophomore fund. ISQ Global Infrastructure Fund II, which was more than double the size of its predecessor, beat its initial hard-cap of $6.5 billion, becoming one of the three largest infrastructure funds raised last year.

Evercore also helped LS Power Equity Advisors beat its original $2 billion target for its fourth North America-focused power fund, raising $2.25 billion within eight months since its launch. With its track record in infrastructure fundraising gaining momentum, it’ll be interesting to follow Evercore’s course in the coming year.

1. Crédit Agricole
2. BNP Paribas
3. Sumitomo Mitsui Banking Corporation

Big deal in infrastructure in 2018? It’s likely Crédit Agricole was present. That is, at least, what it feels like after a successful year for the French bank. The $5 billion GIP-led purchase of Equis Energy, the largest ever acquisition of a renewables portfolio, was one instance where the bank flexed its financial muscles. Staying with Asian renewables, Crédit Agricole was one of 11 banks which took part in financing Formosa 1, Taiwan’s first offshore wind farm.

The same sector – on a different continent – saw Crédit Agricole become one of five lenders in the €1 billion refinancing of EF Solare’s Italian photovoltaic fleet, the largest refinancing in the space. The Italian link remained strong until the end of 2018 when the bank helped close the €3.9 billion Trans Adriatic Pipeline, said to be the largest European project finance of 2018.

1. Clifford Chance
2. Linklaters
3. Norton Rose Fulbright

Be it M&A, project finance or fund advisory, Clifford Chance was right in the thick of the action in infrastructure in 2018.

As well as advising GIP and Macquarie on Asian investments Equis Energy and Formosa 1, the law firm also took on some of Europe’s largest challenges with the same clients. Clifford Chance advised GIP on its £4.5 billion ($5.9 billion; €5.2 billion) investment in the Hornsea 1 offshore wind farm in the UK, set to be the largest in the world. It also advised the Macquarie-led consortium on the acquisition financing for its $6.7 billion takeover of Danish telecoms group TDC.

Elsewhere, Clifford Chance was the advisor on the secondaries process for Meridiam’s first European fund, where investors sold 25 percent of interests in the vehicle, while it also advised Capital Dynamics’s $1.2 billion Clean Energy Infrastructure VIII fund.

1. Wilmington Trust
2. Deutsche Bank Corporate Trust

Truly the end of an era, as Deutsche Bank’s eight-year grip on the award comes to an end. It was usurped by last year’s third place, Wilmington Trust.

The Delaware-based firm powered itself to the top spot, almost literally, following a successful year in the conventional power, power transmission and renewable sectors. It also made substantial progress on telecoms deals. From data centres for CIM Group to renewables for Capital Dynamics and to midstream investments for OMERS, Wilmington had the market covered.

The deals worked on by Wilmington ranged in size from about $250 million to $1.5 billion, with the group performing a variety of roles including administrative agent, intercreditor agent, collateral agent and depositary agent. Wilmington also focused on developing deeper relationships with infrastructure debt funds and institutional investors, diversifying from a traditional base of banking clients.