EMEA: Infra heavy-hitters set up new infrastructure fund

26 April 2018 - 12:00 am UTC

Sacyr and Fininc-backed Circuitus Capital have launched fundraising for a new core infrastructure fund, Inframation has learnt.

The London-headquartered asset manager launched Circuitus Real Asset I earlier this month with a fundraising target of EUR 2bn, sources said. The fund has a hard cap of EUR 3bn.

It is understood that Circuitus Capital is advised on the processes by Citi (placement) and Goodwin Procter (legal).

Circuitus Capital, Citi and Goodwin Procter all declined to comment.

Founded in 2014, Circuitus Capital is owned by Sacyr and Fininc-owned Finsa SRL and the firm’s management.

The management team is led by chairman Carsten Kengeter, alongside CEO and managing director Niccolo Ragini Kothny.

They previously worked together at both Goldman Sachs and UBS. Kengeter moves from Deutsche Borse, where he was CEO, and Ragnini Kothny from BTG Pactual, where he was a partner. 

They are joined by Sacyr CFO Carlos Mijangos and Fininc CEO Claudio Dogliani, who have the role of managing directors.

The firm aims to benefit from its relationship with Sacyr and Fininc, which have actively invested in the sector together for decades.

As well as owning the management business, the Spanish and Italian infrastructure investors will provide substantial cornerstone commitments to the fund.

It is envisaged that the fund will invest in both construction stage and operational infrastructure assets won through public tenders.

LP investors will be offered substantial co-investment alongside the fund opportunity.

The first asset to be seeded to the fund is Italy’s EUR 2.3bn Pedemontana Veneta Toll Road, which reached financial close in November, having priced EUR 1.22bn 30-year 5% senior notes and EUR 350m 8% subordinated notes. The transaction was Europe’s first non-multilateral backed long-term greenfield project bond financing. 

The asset, which required a total equity investment of EUR 430m, is expected to be transferred to the fund with Sacyr and Fininc retaining 20% of the project equity.

It is understood that the fund is in the later stages of finalising two further investments.
One of these is expected to be the EUR 2.3bn Rome Latina Toll Road, which could use a similar financing structure to the Pedemontana Veneta Toll Road.

The fund will target investments across the road, port, airport, energy and water and waste sectors.

It will predominantly invest across continental Europe, but can also seek to allocate up to a third of its capital towards opportunistic investments in Latin America.

The fund has a five-year investment period running from final close and a 12-year term subject to three optional one-year extensions.

It targets a gross IRR in excess of 15%.