M&G Investments has kicked off a global listed infrastructure fund targeting core and technology-driven infrastructure.
The fund, called the M&G Global Listed Infrastructure Fund, will place just over half its capital into North America and close to 30 percent in Europe, with half of that total going to the UK. Other geographies targeted include Hong Kong, Singapore, Australia and Brazil.
“The fund will invest in companies which own and operate the infrastructure we have come to rely upon in daily life, including utilities, energy and transport infrastructure,” said Alex Araujo, the fund’s manager. “Due to their critical, essential nature, demand for these services tends to display resilience throughout the economic cycle.”
The fund does not have a target size, according to an M&G spokeswoman, but will invest in 40 to 50 firms from an investable universe of 276 companies with a combined market cap of over $3 trillion. It will aim for returns outperforming the MSCI AC World Index, which measures global equity market performance, and to increase its income stream every year.
The vehicle will look to dedicate 65-75 percent of its capital to transportation, utility and energy infrastructure. The remainder will be split between social infrastructure such as schools and hospitals and tech-driven infrastructure including cellular towers and data centres.
“The infrastructure landscape has had to evolve to support the realities of modern-day life, which increasingly depends on digital services and high-speed connectivity,” said Araujo. “Accordingly, we broaden our investible universe to include an ‘evolving’ infrastructure class, which offers long-term structural growth and compelling investment opportunities for the fund.”
Based in London, M&G holds £2.6 billion ($3.4 billion; €2.9 billion) invested in listed infrastructure through its affiliate Infracapital.