Stonebridge launches second infra debt fund

Stonebridge Financial Corporation has launched its second infrastructure debt fund, securing initial capital commitments of approximately C$201.5 million (€143.2 million; $178.7 million) from the Business Development Bank of Canada and other Canadian institutional investors, the Toronto-based fund manager said in a statement.

The fund will be open-ended for a period of 10 years and will invest in long-term, fixed rate senior debt financings for the construction, operation and ownership of infrastructure assets across the asset class, including transportation, water/wastewater, energy and social infrastructure, Stonebridge said.

“Stonebridge believes that private infrastructure debt is an ideal asset for providing institutional investors with incremental yield, portfolio diversification, credit enhancement and liability matching characteristics not otherwise available in the public fixed income market,” Stonebridge co-chief executive and partner Robert Colliver said.

The firm announced the launch of a second infrastructure debt fund last year. According to a press release dated April 12, 2013, the fund was closed-ended and had a target of at least C$300 million, which Stonebridge expected to reach by December 2014. It is unclear why the firm has announced the launch of a second fund with different characteristics to that originally announced in 2013. Stonebridge did not respond to requests for comment.

“Our participation in this second Fund will increase senior debt availability for entrepreneurs developing smaller projects within the Canadian infrastructure ecosystem,” said Yvon Jeghers, senior vice president, corporate financing at BDC.

The Business Development Bank of Canada also invested in Stonebridge Infrastructure Debt Fund I, which the firm raised with the support of PPP Canada, the Canadian government’s public-private partnership authority, in 2012. A closed-ended fund, Stonebridge Infrastructure Debt Fund I closed on C$201.5 million and was fully invested in less than 15 months in 12 social infrastructure and energy debt transactions.

Founded in 1998 with the support of three major Canadian life insurance companies, Stonebridge arranges and structures debt financings for syndication in the Canadian institutional marketplace, focusing on the energy and social infrastructure sectors.