Macquarie Russia fund in second, $83m deal

The $630m Macquarie Renaissance Infrastructure Fund, which targets Russia and the CIS countries, has invested in a power plant in St. Petersburg. With its second investment, the fund has now put to work more than $200m.

Christmas time seems to be a fertile period for the Macquarie Renaissance Infrastructure Fund (MRIF), a joint venture between the Macquarie Group and emerging markets-focused investment bank Renaissance Capital, with the vehicle announcing its second deal exactly one year after its debut investment.

MRIF, a $630 million fund targeting Russia and the Commonwealth of Independent States (CIS) countries, has spent $83 million investing in GSR Energy Investments, a Russian power firm. The CIS countries include 12 former Soviet Socialist Republics such as Kazakhstan and Ukraine.

GSR Energy will use MRIF’s investment to help finance a new combined heat and power plant on the outskirts of St. Petersburg, Russia, to provide power there and in surrounding cities. The plant will generate some 220 megawatts of power to the electrical grid and 153 Gkal/h of heat to the industrial region of Kolpino.

“This is the second investment for MRIF and takes total fund investments to more than $200 million,” Damian Secen, MRIF’s chief executive officer said in a statement. “GSR’s stable regulated revenues, coupled with an excellent growth profile due to the current expansion of the Kolpino industrial zone, make this investment particularly attractive for MRIF,” he added.

MRIF spent three years on the fundraising trail and closed this June below its original, $1 billion target. It did its debut deal in December 2010, when it invested $125m in Brunswick Rail, Russia’s largest privately owned rail rolling stock leasing company.