Pacific Equity Partners nears first close on new infra fund

The Sydney-based private equity firm expects to reach a first close in the coming months on around $300 million.

A year after hiring AMP Capital managing director Paul Foster to develop its infrastructure strategy, Pacific Equity Partners appears to be on track to reach a first close on its Secure Assets Fund on around A$400 million [$302.2 million; €251.9 million], sources with knowledge of the process told Infrastructure Investor.

PEP began marketing the fund to investors in February this year. It aims to generate returns for investors in the mid-teens, lower than traditional private equity funds, which often target returns of 20 percent or more, but higher than core infrastructure.

The fund is expected to pursue investments in transport, logistics, power generation and utilities, focusing on investments that are backed by physical assets and have secure revenue streams, the source said.

While PEP, whose assets under management total A$2.5 billion, has been investing in Australia and other countries since 1998, the Secure Assets Fund is the first vehicle dedicated to the infrastructure sector. PEP’s current portfolio includes Australian bakery ingredients giant Allied Pinnacle, consumer healthcare company iNova Pharmaceuticals, and health products firm Manuka Health.

PEP declined to comment for this story.