Manulife Investment Management, the asset management arm of Canada’s largest insurer, has bought a minority stake in a new infrastructure fund manager with the option of acquiring a majority stake in the future.
Albamen Capital Partners will focus on renewable energy, data centres “and other power-intensive infrastructure assets in China”, Manulife said in a statement.
While Albamen Capital Partners is a new entity, its founder Raymond Fung, is also the founding member of another fund manager investing in China’s infrastructure sector, JIDA Capital. It is understood that Fung has acquired JIDA Capital’s entire team, investment track record and intellectual property. The Shenzhen-based firm is in the process of winding down over the next 12 months.
“The Albamen team has vast experience managing assets specialised in [the] solar and energy space, amounting to $530 million with a portfolio of nearly 1GW of renewable energy generation assets,” Myron Zhu, head of Asia private markets, told Infrastructure Investor, referring to CGN Capital Partners Fund III. That vehicle was a joint venture launched in 2015 with the private equity arm of China General Nuclear Power.
Albamen Capital is expected to launch a fund next year and Manulife IM plans to provide $100 million in seed funding and be an active co-investor after Albamen obtains its necessary permits, Zhu said.
“We have such a strong conviction, obviously, we will seed $100 million for the upcoming [Albamen] fund and we’ve even earmarked additional, significant capital for their next fund if they ever come to market again,” he told sister title Private Equity International, in a separate interview. “This would be pure Manulife money; we want to align our own capital as [having] the same interest with potential prospective investors if we come to the market.”
In October, Albamen appointed Conrad Yan, the former vice-chairman of Campbell Lutyens in Asia, as co-managing partner, PEI reported.
Infra the first step to a broader private markets platform
Manulife IM will “absolutely” consider doing the same with an Asian private equity or private credit business as it seeks to build its regional presence, he added.
“This is the first building block for Manulife’s private markets Asia business and to a certain extent this laid out like a blueprint for the type of things I’m going to do in Asia,” Zhu said.
“For other strategies, I would say we are very much looking at the overall pan-Asia set up if we can, but obviously some of the China managers coming out stand out to be very strong and highly differentiated. We’d be happy to repeat what we did for Albamen.”
Zhu joined the Hong Kong office in 2019 from Aberdeen Standard Investments, where he was co-head of Asia-Pacific private equity, and is responsible for building a third-party offering for Manulife’s existing private equity, private credit and real estate teams. Manulife closed its debut fund of funds, Manulife Private Equity Partners, in January on $1.5 billion and raised $2 billion for its first third-party infrastructure fund in 2018.
“For the other potential partnerships, it depends on what the preference of the team [is],” Zhu said.
“I would envision most likely it will be a self-contained strategy, at least at the beginning. However, over the years if we ever exercise our right to bring the team in-house or we take control … it’s highly likely, we would look for a way to build a synergy across all these investment teams, both from a deal cross-referring perspective, but more importantly I think I want to centralise the middle and the back office from a risk management, compliance, reporting standards, etc [perspective].”
Asia-Pacific accounts for around 5 percent of Manulife IM’s $100 billion of private markets AUM.
Jihyun Kim contributed additional reporting.