Actis has reached a final close on its Energy 4 fund, beating its $2 billion original target to hit the vehicle’s hard-cap of $2.75 billion.
The firm described the offering, launched in the third quarter of 2016, as “significantly oversubscribed”, underpinned both by “sizeable” re-ups and new commitments. The vehicle is more than twice the size of its predecessor, closed in 2013 on $1.15 billion. The firm said the final milestone was attained just four months after initial close, adding that the fundraising had been done entirely in house.
Actis Energy 4’s investor base includes pension funds, insurance companies, endowments and sovereign wealth funds. Known LPs in the vehicle comprise the Teacher Retirement System of Texas, the International Finance Corporation, Allstate Investments, the Arizona Public Safety Personnel Retirement System, the Employees Retirement System of Texas and the Teachers' Retirement System of the City of New York, according to Infrastructure Investor data.
The fund has a 10-year duration, according to sources with knowledge of the firm, which added that Actis Energy 4 achieved a re-up rate of 70 percent. It is understood that about half of its LPs came from the Americas.
The firm declined to comment on fund details but Torbjorn Caesar, Actis’ co-head of energy, told Infrastructure Investor last year that it had targeted IRRs in the mid-20s through its first three energy funds.
The fund seeks to acquire controlling stakes in Latin American, African and Asian electricity generation and distribution businesses. The close comes just days after Actis bought a portfolio of solar projects in Latin America with a combined capacity of 1.5GW from bankrupt US developer SunEdison, a transaction funded by Actis Energy 4.
The assets, comprising both 578MW of operational assets and projects at an advanced stage as well as a further 1GW in the early stages of development, were used to seed Atlas Renewable Energy, a platform based in Chile that will seek to expand across markets such as Brazil, Mexico and Uruguay.
The firm said Actis Energy 4 already has a pipeline worth $2 billion of equity deals either completed or in the late stage of completion, including four large-scale regional platforms. Two of these investments are set to close this quarter, according to sources.