AMP Capital has reached final close on the AMP Capital Infrastructure Debt Fund III (IDF III), raising US$2.5 billion for the mezzanine debt strategy, an additional US$800 million in co-investment rights and securing a further US$800 million from global investors who want access to its deal capabilities.
The total fundraise of US$4.1 billion is believed to be one of the largest in the world for an infrastructure debt strategy. IDF III, the third infrastructure debt fund launched by AMP Capital in six years, had a target of US$2 billion, which was exceeded due to overwhelming interest in the strategy from investors.
More than 125 investors from 12 countries have invested in IDF III, with strong interest from institutional investors in Japan and Korea including those that had committed to AMP Capital’s previous infrastructure debt funds. Korean investors committed more than US$300 million and Japanese investors were also strong supporters of IDF III, committing more than US$700 million. AMP Capital was assisted in Japan by its partner MUFG: Trust Bank.
AMP Capital Global Head of Infrastructure Debt Andrew Jones said: “I’m thrilled at the level of confidence in the infrastructure debt asset class and our team as evidenced by our successful fundraise for Infrastructure Debt Fund III.
“We have exceeded our expectations, attracting interest beyond the fund’s hard cap of US$2.5 billion and securing additional commitments outside the fund. These commitments will be called on after IDF III makes its allocation to each investment, with priority given to the fund and its investors.
“We had success in new markets such as Korea and consolidated the support we have received previously from Japanese investors. Asian investors, particularly pension plans and insurance companies, increasingly recognise the benefits of infrastructure debt such as attractive yield with capital stability.”
IDF III has an investment period of four years. Mr Jones added: “Our focus is now on prudently investing the capital raised, finding great assets on behalf of our IDF III investors to deliver them great performance. We have already secured four high quality assets for the fund and are seeing further opportunities across a range of sectors including renewables, telecommunications and energy distribution in OECD countries. Infrastructure companies increasingly view private mezzanine debt as an ideal source of funding for a range of their specialised financing needs.”
AMP Capital’s first infrastructure debt fund was closed to new investment in 2012 after raising US$500 million globally. Its second fund, IDF II, raised US$1.1 billion.
Overall, the team, which comprises 13 investment professionals located in London, New York and Sydney, has invested more than US$3.5 billion in 59 infrastructure debt assets since 2001.