First look

EQT jumps on the core infra bandwagon
Renewed demand for core infrastructure and longer-term funds shows little sign of letting up. Swedish private equity giant EQT, traditionally a core-plus infrastructure player, looks set to be the latest to board this train, with the group noting in its latest results that preparations for an “Infrastructure Core strategy” are underway.

“This is early days but we currently expect that the longer-hold strategy in private capital and the potential infrastructure core strategy over time will constitute about €10 billion of AUM in total,” chief executive Christian Sinding said last week, as reported by affiliate title Private Equity International (subscription required).

He added that the Infrastructure Core and longer-hold private capital vehicles will have “slightly lower returns with lower risk, with strong value creation over the long term”.

Watch this space, then.

Generate raises $2bn for sustainable infra-as-a-service
It may not be a fund, but Generate Capital can sure raise money like one. Witness its latest $2 billion equity raise – led by existing investors QIC and AustralianSuper – which attracted commitments from new investors including Harbert Management Corporation, Aware Super and CBRE Caledon. Repeat investors such as AP2, the UK’s Railways Pension and The Wellcome Trust also made an appearance, alongside other institutional investors from Australia, the US and Europe, the firm said.

Founded in 2014, Generate has deployed an infrastructure-as-a-service model to build a $2 billion global portfolio of more than 2,000 infra assets across energy, waste, water and transport projects. CEO Scott Jacobs told CNBC that Generate focuses on transactions others might not fund, including small deals and early-stage technologies.

“We have had great success attracting institutional investors because this is a very compelling investment return profile relative to the risk undertaken,” Jacobs said, noting all of its fundraising rounds have been oversubscribed.

This year it has also doubled its staff count and in March it launched Generate Credit, which focuses on loans to green projects and firms.

Northleaf closes third mid-market fund on $1.4bn
Canada’s Northleaf Capital Partners has sailed past its $1.25 billion target to close its third infrastructure fund on $1.4 billion. The manager said it had attracted commitments from pensions, insurance companies, sovereign wealth funds and family offices in North America, Europe and Asia.

Focusing on mid-market assets in OECD countries, the vehicle has already committed more than 35 percent of its capital to a portfolio of five assets. Its latest acquisition was of the UK’s Quickline Communications, a provider of ultrafast broadband to rural and hard-to-reach areas. What’s more, the new fund has “strong momentum in our deal pipeline”, said Northleaf co-head of infra, Jamie Storrow.

Sounds like Fund IV might not be too far away, then.

‘Teseting’ the waters
Last week, we brought you news of two first-time renewables funds in Spain. Now, Madrid has another newcomer on board following the launch of Teset Capital by former I Squared Capital VP José Arango, alongside Javier Zabala and Ángel Escudero, both formerly from the infrastructure unit of Madrid-based GED Capital. Arango was also chairman of former I Squared portfolio company T-Solar, the renewables developer sold to Cubico last year.

The trio have begun fundraising for Teset Infrastructure Fund I, which is targeting €400 million and which has already raised €100 million. The fund is set to target deals across Europe in the energy, transport, telecoms, social infra and environment sectors.

Seems like Spain is certainly feeling the infrastructure heat this summer.

Essentials

Final week for II 100 submissions
As you know, we are repositioning our flagship ranking of the world’s 50 largest equity GPs for the 2020s, which is why this year we’ve decided to upsize it to the Infrastructure Investor 100 and add another 50 GPs to our list. This is the final week to get in front of our research and analytics team, so email your submissions to Tom Zimmermann (tom.z@peimedia.com) by 30 July. You can download the submissions form and full methodology here.

Grapevine