Global Infrastructure Partners Ltd (GIP), owner of London's Gatwick Airport and of pipelines formerly owned by Chesapeake Energy Corp (CHK.N), completed fundraising for its second infrastructure fund, raising $8.25 billion and making it the largest infrastructure fund globally to date.
The fundraising is the latest sign that independent asset managers with a successful track record are tapping demand for infrastructure investments and exploiting the hurdles facing investment banks that must comply with new cumbersome regulations for such products, including Morgan Stanley (MS.N).
"We are extremely gratified by the confidence that our investors in GIP II have placed in us. We believe that the well documented need for infrastructure investment across the globe will provide a very attractive investment environment for GIP II," GIP Chairman Adebayo Ogunlesi said in a statement.
GIP II, GIP's second fund, is now bigger than Goldman Sachs Group Inc's (GS.N) first infrastructure fund, which raised $6.5 billion in 2006.
One of GIP's investors, the Oregon Investment Council, said in September 2011 that GIP II was targeting gross returns of 15 to 20 percent and had a target of $5 billion. But GIP raised its fundraising target based on investor demand.
GIP currently boasts 13 portfolio company investments with combined annual revenue of over $4.5 billion and more than 12,000 people on their payroll.
Research firm Preqin said earlier this week that infrastructure funds holding a final close, that is, reaching their ultimate target for capital, nearly halved in the third quarter, with six funds raising $2.7 billion, compared with 11 funds raising a total $5.2 billion in the previous quarter.
Some 142 infrastructure funds are currently available, targeting $91.6 billion in investor capital so they can invest in assets such as roads, airports and power grids, Preqin said.
GIP, founded in 2006 with backing from General Electric Co (GE.N) and Credit Suisse Group AG CSGN.VX, raised $5.6 billion for its first infrastructure fund, targeting assets in the transport, energy, utilities and waste sectors.
Goldman Sachs was not as successful in its second infrastructure fund endeavor, slashing its fundraising target in half in the middle of its marketing process and ending up raising $3.1 billion.
(Reporting by Greg Roumeliotis in New York; Editing by Bernard Orr)