New York-based Stonepeak Infrastructure Partners has sailed through to a first and final close on its second infrastructure fund, reaching its $3.5 billion hard cap just six months after launching the vehicle.
Fund II, which was oversubscribed, brings Stonepeak’s total assets under management to $5.7 billion.
“The majority of the capital commitments to Fund II came from investors who also participated in Fund I,” Stonepeak said in a statement on Monday, without disclosing names. According to Infrastructure Investor Research & Analytics, limited partners that have invested in both funds include the Oregon Public Employees’ Retirement System, the Teacher Retirement System of Texas, the Virginia Retirement System and the New Mexico Educational Retirement Board.
Institutional investors that have committed capital to Stonepeak for the first time include the Rhode Island State Treasury, the Employees Retirement System of Texas and the Maine Public Employees Retirement System.
While Stonepeak Infrastructure Fund II is more than double the size of its predecessor – Fund I closed on $1.65 billion in October 2013 – it will continue to target North American infrastructure investments in sectors including midstream oil and gas, renewable power, water, electric utilities and transportation.
A potential difference in strategy between the two vehicles, however, is that while Stonepeak did make a number of greenfield investments through Fund I, the new fund may focus more on brownfield assets.
“We have witnessed a two-speed financial market over the past six months, with cracks in energy, power and high-yield credit on the one hand, and strength (until very recently) in broader equity markets on the other,” Stonepeak co-founder and senior managing director Michael Dorrell said. “It is becoming a good time to invest in operating infrastructure businesses, and if cracks continue to widen, the situation for our investors will improve accordingly.”
According to meeting materials from the Oregon Investment Council, which acts on behalf of the Oregon Public Employees Retirement Fund (OPERF), Fund II will target majority and/or control positions in the mid-market with individual equity investments in assets ranging from $75 million to $300 million.
The fund will have a five-year investment period and a 12-year duration with three possible one-year extensions.
Campbell Lutyens served as exclusive global placement agent for Fund II. Simpson Thacher & Bartlett served as US legal counsel.