The South Carolina Retirement System Investment Commission (RSIC) approved an EUR 125m (USD 146m) commitment to the Macquarie Super Core Infrastructure Fund during a 14 June meeting.
Macquarie is looking to raise capital in three series for the 20-year fund. It is anticipated that the manager will hold the fund’s Series 1 close on 22 June, according to board meeting materials obtained by Inframation. The fund manager launched the capital raise in April 2017.
The final close would represent the first of three series closes that would entail the entirety of the targeted EUR 4.5bn fundraise. Series 1 is expected to close at EUR 2.5bn, according to the documents.
The fund manager’s marketing materials indicate that the fund will make three investments in regulated utilities based in Europe by the beginning of 2019. The fund has two holdings so far; Elenia, an electricity distribution and heating company based in Finland, and Cadent Gas, a gas distribution company based in the United Kingdom.
Following the three utilities investments, Macquarie will make six investments between 2019 and 2021, while simultaneously holding two follow-up fundraises for Series 2 and 3 of the fund. There is potential for the fund to invest in US, Canadian and Australian assets; up to 25% of Series 1-3 commitments, according to the documents.
The fund has an initial 20-year term beginning at the close of Series 1, with the possibility to extend in five-year increments into perpetuity, based on a majority vote of the investors in the fund. The Fund expects to deliver a 7-8% net annual return with a 5% annual cash yield.
The GP will charge management fees of 50bps per annum on undrawn commitments, exceeding no more than 0.65% of the fund’s net asset value. The fund does not provide for redemption or repurchase of the units of investors at their request, but the manager will offer investors the ability to divest their interest through a structured secondary process that will be offered at least every ten years.
The fundraise is coordinated by Macquarie Infrastructure and Real Assets (MIRA) internally, with Goodwin Procter providing legal advice.