Macquarie Russia fund in $50m telecom deal

The acquisition of a stake in Russian Towers, an operator of telecommunications infrastructure, is the Macquarie Renaissance Infrastructure Fund’s third deal. With over $250m already invested, Macquarie is close to having its $630m Russian vehicle halfway invested.

The Macquarie Renaissance Infrastructure Fund (MRIF) – a joint venture between the Macquarie Group and emerging markets-focused investment bank Renaissance Capital – has completed its third deal with the purchase of a shareholding in Russian Towers, a developer and operator of telecommunications tower infrastructure in Russia.

The $50 million deal sees MRIF enter Russian Towers’ shareholding structure as the largest investor in a second, $100 million round of equity raising, which also saw current shareholders UFG Private Equity and the European Bank for Reconstruction and Development (EBRD) invest $15 million alongside MRIF. Russian Towers, founded in 2009, first raised new equity in 2010, when the EBRD and UFG Private Equity first joined the company.

MRIF describes the Russian firm as a “leading independent telecommunications tower owner and developer in the Russian market” with a portfolio of more than 300 operational towers across the country. The telecommunications firm plans to use the new equity raised to expand its tower portfolio to more than 1,000 towers within the next three to four years.

“The investment case for towers is very compelling in Russia. Mobile penetration is very high and there is rapidly growing demand for reliable network coverage,” Damian Secen, MRIF’s chief executive said in a statement.

For MRIF, a $630 million fund targeting Russia and the Commonwealth of Independent States (CIS) countries, Russian Towers is its third investment, taking the fund to being close to halfway invested, with more than $250 million committed across three deals. In addition to Russian Towers, MRIF has invested in Brunswick Rail, in December 2010, and GSR Energy, late last year.

MRIF spent three years on the fundraising trail, closing last June below its original, $1 billion target.