Melbourne-based Westbourne Capital has reached a first close on $1.5 billion for its latest infrastructure debt platform, managing director David Ridley has told Infrastructure Investor.
The infra debt funds manager, which is celebrating its 10th anniversary this month, is aiming to raise $3 billion in the current round of fundraising and has secured several commitments and re-ups from existing LPs.
“Our priority has been to work with our existing LPs to make re-ups or new commitments now that the capital they’ve previously provided has been invested,” Ridley said, during a keynote interview that will be published later this week. “And we also anticipate raising some commitments from LPs who are new to the Westbourne platform. We’re in reasonably progressed discussions with a series of pension and sovereign wealth funds to be able to execute that over the coming months.”
Around 45 percent of the funds raised so far has come from pensions, 40 percent from sovereign wealth funds, and 15 percent from insurance clients, with the split 70-30 in favour of non-Australian clients.
Westbourne Capital counts more than 40 LPs among its investors, including sovereign wealth funds such as Australia’s Future Fund and the National Pension Service of Korea, as well as pensions including Qantas Superannuation Fund, Mercer, LGIA Super, HESTA, and First State Super.
Ridley said he expected to see increased demand from insurance companies for infrastructure debt investments, as they seek to replace lower-returning government bonds for their fixed-income portfolios with “an asset class that they feel comfortable lending into for a sufficiently long period that it will add value to their liability-management programme”.
Westbourne aims to complete fundraising for the platform by the end of 2018 and will deploy capital over the subsequent three years, in line with its previous fundraisings. While declining to name specific assets, Ridley said deployment will target opportunities in the transportation, utilities, energy and telecommunications sectors in OECD countries.
“We’re really seeking to make six to 10 investments over a three-year investment period with the current fundraise,” Ridley said.
Ridley added that he anticipated a period of increased market volatility which would likely lead to a greater volume of secondary opportunities, but was “agnostic” on whether opportunities came on the primary or secondary markets.
Westbourne Capital has raised around $8 billion of capital since it was founded in 2008 by Ridley and two other former Hastings Funds Management directors and has deployed $6.7 billion of that capital into 63 debt investments.
In our upcoming keynote – which features in the October issue of our magazine – Ridley talks to Infrastructure Investor about the firm’s 10-year journey, the evolution of the infrastructure debt asset class and what the future holds.