GIP IV targets June USD 20bn final close

05 April 2019 - 12:00 am UTC

Global Infrastructure Partners (GIP) hopes to hit a hard cap USD 20bn (EUR 17.8bn) final close of its fourth infrastructure equity fund in June, and complete monthly closes before then, according to sources and documents.

The New-York headquartered asset manager, which only began fundraising for Global Infrastructure Partners IV (GIP IV) last September, had an original target of USD 17.5bn.

It follows its earlier two-part first close, one last December and a second more formal one month later.

As of mid-February, the fund, which has a minimum LP commitment threshold of USD 25m, had commitments in excess of USD 8.75bn, according to a document seen by Inframation.

Limited partners that have backed the fund include Alaska Permanent Fund (USD 500m), Oregon Investment Council (USD 400m), Virginia Retirement System (USD 200m), Maine Public Employees Retirement System (USD 150m), Greater Manchester Pension Fund (USD 100m), and Missouri Local Government Employees’ Retirement System (USD 100m), other documents show.

The manager, which is co-ordinating the fundraise internally, has committed to provide 1.5% of the fund’s capital up to USD 300m. Debevoise & Plimpton is advising it on legal aspects of the fundraise.

If successful, the final close would be a 27% increase on the USD 15.8bn raised by GIP for its third infrastructure fund in March last year.

But the third fund, Global Infrastructure Partners III (GIP III) – which has committed USD 12.1bn in the past two and a half years – has also mobilised a further USD 2.9bn in co-investment alongside the fund (see Figure 2)

For its latest fund, only LP investors with commitments of USD 500m or more will be offered the opportunity to co-invest alongside the fund, sources said.

Figure 1: Global Infrastructure Partners’ (GIP) Equity Fund Performance*
  GIP I GIP II GIP III
Gross/Net IRR 23%/17% 32%/21% 26%/15%
Gross MOIC 3.1 x 2.0x 1.2x
Average Cash Yield 12% 6% 3%
Final Size USD 5.6bn USD 8.25bn USD 15.8bn
Invested Capital USD 5.3bn USD 8.25bn USD 12.1bn**
Realised Value USD 11.95bn USD 5.72bn USD 0.24bn
Unrealised Value USD 3.79bn USD 10.68bn USD 12.62bn
# of Portfolio Companies 12 11 8
Exits 10 4 0
*Accurate as of 30 September 2018
**  Includes c. USD 1.7bn in outstanding commitments to Borkum Riffgrund 2, Clearway Energy and Hornsea 1
Source: Global Infrastructure Partners Presentation Document Feb 2018