Macquarie Group has cut around 10 percent of staff in its infrastructure investment business, according to a report in the Financial Times which was confirmed to Infrastructure Investor by a source at the organisation. Around 60 employees have lost their jobs from within a team that was almost 600-strong.
The Australian investment bank has restructured its infrastructure business following a tough period in the wake of the financial crisis. It has been forced to sever ties with most of its listed funds, which have seen the value of highly leveraged assets tumble. It has since switched to a greater focus on unlisted funds.
However, as the FT report indicates, the unlisted funds have also been struggling to gain traction with investors. The firm’s third European fund recently closed on €1.2 billion, a long way short of its original target of €5 billion as well as the €4.6 billion it raised for its second fund.
The FT goes on to report that Macquarie has reduced management fees from 1.5 percent to 1.25 percent for its fourth European fund, which it says is aiming to collect between €2 billion and €3 billion.
Nor have the firm’s fundraising woes been restricted to Europe. In April this year, the US-based Macquarie Infrastructure Partners Fund II held a final close on $1.6 billion having been in the market for two years with an original target of $6 billion. The prior US fund had raised $4 billion.
The firm has had more fundraising success in emerging markets, where it has been expanding its operations – especially in Latin America. Earlier this year, it announced the launch of a new Mexican infrastructure fund with $408 million in commitments, including $268 million from seven Mexican pension funds.