Macquarie eyes initial fundraise of €1.5bn for Super Core fund

The new vehicle – which could end up raising more than €4bn – will be seeded with MIRA’s UK gas distribution investment.

Macquarie Infrastructure and Real Assets is looking to raise at least €1.5 billion over the coming months for its new Super Core Infrastructure Fund, Infrastructure Investor has learnt.

The initial capital-raising is understood to be the first in a series – with each targeting a similar amount. It is believed at least two further series will begin activity once the original capital, targeting investments in Europe, has been deployed. The first series is expected to finish raising by the middle of next year.

The fund is understood to have been launched to target investors looking for regulated assets with a lower risk-and-return profile than those offered by the firm’s Macquarie European Infrastructure Funds. It is also set to offer a longer exposure to the assets than the MEIF vehicles, with a planned 20-year term as well as a rolling five-year extension mechanism. The first four MEIF funds have 10-year terms, while the fifth is structured as a 12-year vehicle.

At the group’s half-year results presentation held at the end of last month, chief financial officer Patrick Uphold confirmed MIRA’s investment in the UK’s gas pipeline network – since renamed Cadent Gas – would act as a seed asset in the Super Core fund. MIRA holds a 14.5 percent stake in the Quad Gas Group that last December bought 61 percent of the network from the National Grid, implying an enterprise value of £13.8 billion ($18.1 billion; €15.6 billion).

Macquarie declined to provide further details on the fund than those disclosed by Uphold.

The fund is understood to target similarly large regulated assets, although not on the scale of the 130,000 km Cadent Gas network. A significant co-investment offering is also believed to be planned.