FRANKFURT, March 24 (Reuters) - Allianz Global Investors, an asset manager for Europe’s biggest insurer Allianz SE, is investing 433 million euros ($597 million) in a Belgian motorway project, reflecting a quest among long-term investors for higher-yielding holdings.
AllianzGI said it was investing in senior debt of the A11 motorway on behalf of the Allianz group and unnamed third party-clients, pushing AllianzGI’s infrastructure investments above 2 billion euros.
Rock-bottom interest rates on government bonds have left insurers and pension funds eager to find higher-yielding long-term investments that they can use to meet obligations to policy holders payable decades in the future.
The A11 project involves building 12 kilometres of motorway to connect the port of Zeebrugge with the E40 and E34 motorways in West Flanders.
The European Investment Bank is also investing about 145 million euros in the bonds, which have a maturity of 31.5 years, Allianz said.
The coupon on the bonds, which are issued by an entity called viaA11 NV, is 4.49 percent. By comparison, euro benchmark 30 year debt is currently yielding just under 2.5 percent .
AllianzGI set up a team in late 2012 to help clients invest in senior infrastructure debt and has done eight deals in seven countries over the past year.
“The volume of deals shows that a new asset class is becoming established,” said Deborah Zurkow, chief investment officer for infrastructure debt at AllianzGI. ($1 = 0.7256 Euros) (Reporting by Jonathan Gould and Andreas Kroener; Editing by David Holmes)