Fundraising

Oversubscribed, $1.2bn close for InfraRed fund

The HSBC spinout has managed to raise an extra $200m from investors to close what it is calling ‘the largest fund ever raised that focuses solely on greenfield infrastructure’. The vehicle has already committed more than $400m to a raft of projects.

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Six months after spinning out from UK bank HSBC, London-based InfraRed Capital Partners announced today that its latest infrastructure fund has closed oversubscribed with commitments of over $1.2 billion – $200 million more than it was originally intending to raise.

InfraRed Infrastructure Fund III – which InfraRed is calling “the largest fund ever raised that solely focuses on ‘greenfield’ infrastructure” – has benefitted from new investors including “a broad range of international pension funds, insurance groups, fund of funds, associations and other institutional investors”. Prior to the spinout, about half of the tally raised came from a “small group of predominantly existing investors,” InfraRed pointed out.

Fund III has already invested over $400 million in a raft of projects in places like Singapore, Canada, France and Australia. The fund’s mandate is to invest in public-private partnership (PPP) projects with “limited revenue risk” in social and transport infrastructure. Geographically, the fund is targeting opportunities in North America, Europe, Singapore, Hong Kong and Australia.

InfraRed defines the new vehicle as a “private equity fund which seeks to achieve capital gain for its investors from the realisation of assets once they have completed construction and have a proven and stable operating record”.

InfraRed was formed following a management-led spinout from HSBC in April 2011. HSBC remains a minority shareholder in the firm, which has offices in London, Hong Kong, New York and Paris.