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OPIC invests $250m with I Squared, Meridiam

The pledges are intended to be the first of a series of infrastructure investments by the US institution after receiving proposals from more than 150 private equity firms.

By
Matthieu Favas
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The Overseas Private Investment Corporation (OPIC) has approved nine loans to support private equity funds focused on developing countries.

Infrastructure features prominently among the sectors targeted, with vehicles managed by I Squared Capital, Meridiam Infrastructure and The Abraaj Group all receiving sizeable financing pledges from the Washington DC-based development finance institution.

The largest cheque went to I Squared’s Asia Aggregator vehicle, to which OPIC is lending $200 million. The sum represents between a third and a quarter of the fund’s total capitalisation target, which the agency says is $600-$800 million, including OPIC’s loan.

Meridiam received $50 million in financing for its Africa Fund, whose target is €300 million. The vehicle, which reached a first close earlier in 2015 and has a tenure of 15 years, is focused on sectors including energy and transport.

Abraaj’s Growth Market Health Fund was granted a loan of up to $150 million, a fifth of its $1 billion capitalisation target. The vehicle, which predominantly covers Sub-Saharan Africa and South Asia, will invest in hospitals, clinics, diagnostics centres, medical education businesses and training facilities.

The funds’ selection is part of OPIC’s 2015 Global Engagement Call for Proposals (GEC), a process kicked off by the agency in May and through which it aims to back private equity vehicles targeting “business development, restructuring or privatisation projects” in developing countries.

OPIC has received proposals from more than 150 respondents, according to investment documents, arriving to its present list of chosen funds with the help of investment consultants Meketa Investments Group and TorreyCove Capital Partners.

These approvals are “just the first” from “a number of promising funds” produced by GEC, a spokesperson told Infrastructure Investor, declining to name any future commitments being considered until the next round of approvals draws closer.

The pledges are not the first infrastructure investments made by OPIC, which was one of the institution that helped the South Africa-based Pembani Remgro Infrastructure Fund reach a $245 million first close in May.