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Infracapital nears target for second greenfield fund after £1bn first close

The vehicle’s £1.25bn target is the same figure as the hard-cap of its predecessor fund, which closed in November 2017.

Infracapital is just £250 million ($320.8 million; €296.9 million) away from securing its target for its second greenfield fund after holding a first close on £1 billion last month, Infrastructure Investor understands.

The infrastructure arm of M&G Investments launched Infracapital Greenfield Partners II last year, with the target set at £1.25 billion, the hard-cap on which its predecessor closed in November 2017.

Most of the capital raised to date is believed to have come from European LPs, including a £20 million investment from the East Sussex Pension Fund in the UK. Another local authority pension scheme in the UK is understood to have invested £130 million in the fund.

The greenfield fund is designed to invest in European infrastructure projects in late-stage development or ready to be built projects and is structured as a 25-year fund, rather than the 12-year Infracapital Partners brownfield fund series run by the manager, which has raised three funds to date. It targets gross returns in the mid- to high teens.

Infracapital declined to comment on the fundraising process.

The London-based manager is thought to have made nine investments to date via the first vehicle, with its latest move last month a tie-up with Italian utility Enel to launch distributed energy and energy efficiency projects in Spain. Other investments include Gigaclear, Bioenergy Infrastructure Group and WightFibre.

It is now understood to be close to fully invested. According to pension documents dating back to Infrcapital’s first fundraise, ticket sizes range between £25 million and £100 million with a total of eight to 15 investments expected to comprise the fund’s portfolio.