InstarAGF fund nears halfway point with aviation deal

The Toronto-based mid-market investor closed its debut infrastructure fund on C$740m in June.

InstarAGF Asset Management’s debut infrastructure fund is 40 percent deployed after acquiring a majority interest in Canadian aviation services company Skyservice Investments.

The Toronto-based firm is nearing the halfway point for deploying its Essential Infrastructure Fund, which closed in June on C$740 million ($561 million; €495 million). Details about its investment in Skyservice were not disclosed, but an InstarAGF spokeswoman said the deal will build on its aviation infrastructure platform.

InstarAGF acquired an interest in a passenger terminal at Billy Bishop Toronto City Airport for C$105 million in 2015.
Founded in 1986, Skyservice operates fixed-base operations, aircraft management services and aircraft maintenance.

“Skyservice delivers a critical business transportation service with related required infrastructure to companies and high-net-worth individuals,” the spokeswoman told Infrastructure Investor. “Our criteria for any investment we make include that the asset demonstrate strong credit or offtake qualities, stable and predictable cashflow, and the potential for long-term capital appreciation.”

The Essential Infrastructure Fund is targeting energy, utilities and civil and social infrastructure assets. InstarAGF said it seeks investments with downside protection: assets that have long-term contracts, benefit from concession agreements or fall under regulatory regimes.

The fund has also invested C$78 million for a 30MW wind project and purchased a 20.6 percent interest in a Canadian midstream energy services company for C$75 million last year.

InstarAGF was launched in 2014 as a joint venture with Instar Group and AGF Management, one of Canada’s largest independent investment management firms.