First look

Secondaries investors plug €1.2bn into Antin annex fund
There’s no let-up in 2020 for Antin Infrastructure Partners. We revealed last week that the French manager is planning a new €1.5 billion mid-market fund launch, months after it completed the €6.5 billion fundraising for Antin Infrastructure Partners IV in July.

The Pipeline has now learned of further success for the GP, which is believed to have completed fundraising at the end of October for an annex fund to Antin Infrastructure Partners III and raised more than €1.2 billion. The idea, we understand, is to take minority positions in four of the fund’s assets. The latter have been growing faster than anticipated and require the capital for follow-on opportunities.

Three of the four assets are fibre companies: CityFibre in the UK, FirstLight in the US and Lyntia in Spain. Investors in the annex vehicle, placed by Evercore, are separate to those in Fund III and are thought to comprise traditional secondaries investors.

Antin declined to comment on the fundraising.

It won’t take too many guesses to figure out what’s driving growth in these assets. But the fresh fundraising effort is another success both for Antin’s strategy and for the prospects of digital infrastructure.

Fields of green
The massive demand for communications and clean energy assets means greenfield developments are in vogue for investors, according to the head of Morgan Stanley’s infrastructure group.

In a webinar last week, Markus Hottenrott, managing director of Morgan Stanley Infrastructure Partners, said his firm, like many others, “will probably spend a lot [more] time on greenfield assets than we have in the past,” given the demand for digital and renewables – sectors considered vital to the future of the global economy.

Low interest rates, Hottenrott said, allow the firm to invest in projects “at an earlier point in time” and implement a value-add approach.

It’s a far cry from Hottenrott’s comments to us back in 2013, when he said that “a lot of investors simply want investments at the conservative end of the risk spectrum of the infrastructure asset class”. Greenfield projects, he said, “in some cases, need a number of years before becoming operational and generating cash”.

How time flies.

Know your customer
As infrastructure’s progress continues unabated despite the pandemic, new hiring trends indicate private equity wants to know how the asset class is doing it.

“As PE firms begin selling more assets to infrastructure funds, we have noticed an increase in PE organisations looking to hire infrastructure investment professionals,” Nicholas Sehmer, a senior consultant at London-based recruiter Sheffield Haworth, said in a LinkedIn post. He was referring to the recent $8.1 billion transaction which saw TPG Capital sell Astound Broadband to Stonepeak and Patriot Media.

“This is in order to bring this knowledge in-house and to give [PE firms] a better understanding of what infra funds are looking for when buying an asset,” Sehmer said. This suggests the hiring isn’t being done to enable PE firms to enter the sector, but to help them exit to it.

With digital infrastructure assets crossing the PE/real estate/infra divide, we can expect infra professionals’ appeal beyond their own asset class to grow as well.

Essentials

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Grapevine