The current infrastructure debt fund market consists of both pure debt/mezzanine funds, and funds that plan to make both debt and equity investments. 44% of funds providing debt financing are solely debt-focused vehicles. Aviva Investors Hadrian Capital Fund I and AMP Infrastructure Debt Fund are two such funds and are seeking to raise £1bn and €500mn respectively. Aviva Investors Hadrian Capital Fund I will provide senior debt loans to European infrastructure projects and AMP Infrastructure Debt Fund will provide subordinated debt to both social and economic assets globally, including PPP/PFI projects. 56% of debt funds intend to make both debt and equity investments. One example is DG Infra Yield, managed by Inframan, which will provide a mixture of mezzanine, senior debt and equity to infrastructure projects in the Benelux region. The fund will make equity investments in mature secondary stage assets but will also provide debt financing to greenfield and brownfield opportunities.
Geographically, Asia and Rest of World is the most targeted region, with 19 debt funds primarily focused on assets in these countries. Seven of these funds are managed by Darby Overseas Investments, a debt and mezzanine fund specialist focused on emerging markets. The firm closed its first emerging market debt fund, Darby Asian Infrastructure Mezzanine Capital Fund, in 1998 and has raised $1.8bn to date for debt finance. Seven funds are focused on Europe and one targets North American assets.
This blog is an excerpt from this month’s Infrastructure Spotlight feature article. To view the whole article, please click here. For more information on unlisted infrastructure fundraising as a whole, please see how Preqin’s Infrastructure Online can assist you.