Stafford launches €750m infra secondaries fund

The UK-headquartered fund manager launched Luxembourg-registered Stafford Infrastructure Secondaries Fund IV (SISF IV) in recent weeks with a €750m fundraising target and a hard-cap of €1bn, according to sources familiar with the process.

The manager, which is expected to hold a first close of the fund towards the end of the first quarter, will co-ordinate the fundraise internally and use placement agents in select geographies. Linklaters and Gunner Cooke will advise on legal aspects of the fundraise, the sources said.

The secondaries investor, which has some $900m of infrastructure assets under management, is looking to double the amount it raised for its last dedicated secondaries co-mingled fund, Stafford Infrastructure Secondaries Fund II (SISF II), which hit final close with €399m of commitments in 2018.

Between these two funds, it also closed fundraising for Stafford Infrastructure Co-Investment LP, a £73.4m co-investment vehicle backed by Pantheon Ventures and Migros-Pensionskasse, a Swiss pension fund. This fund acquired Barclays’ £100m LP interest in the 3i Infrastructure-managed BIIF LP in 2016.

The increase in fund size between fund II and the latest fund IV reflects growing investment opportunities in infrastructure funds, which are now regularly more than double the size of those raised four or five years ago.

SISF IV, which could make as many as 30 to 40 individual investments, will look to invest at least half of its commitments in core European infrastructure funds, and the rest in funds across North America, Australia and other OECD countries.

The 10-year fund, which has a three-year investment period and targets a roughly 10% IRR, will also seek to offer diversification by targeting funds with varying vintages – or launch dates – and that target assets across multiple sectors and geographies.

SISF IV will also be able to invest up to 30% of capital commitments directly into assets through co-investments alongside managers.

SCP launched its infrastructure arm in 2012, with the appointment of Matthew McPhee as partner in Boston. In 2014, it acquired Macquarie’s €700m secondaries infrastructure business, comprising infrastructure secondaries, sustainable capital and venture capital fund-of-funds businesses. Macquarie’s Ingo Marten and William Greene joined SCP as part of the deal. They were joined in 2016 by former Barclays Private Equity investor David Lindsay, who joined having advised SCP and sat on its investor committee member for three years.

SISF II has made some 20 investments, including investments in InfraVia European Fund II, Capital Dynamics Clean Energy and Infrastructure Fund, Macquarie Infrastructure Partners, Macquarie European Infrastructure Fund II and John Hancock Infrastructure Fund, according to Inframation data.

In late December, the fund acquired stakes in Archmore International Infrastructure Fund from Bank of China and Stichting Pensioenfonds PGB.

A Stafford Capital Partners-managed account for Switzerland’s IST 3 Infrastruktur Global also acquired a portion of Stichting Pensioenfonds PGB’s interest, according to public filings.

SCP has $5.3bn of assets under management across timber, agriculture, private equity, sustainability, venture capital and credit.

SCP, Linklaters and Gunner Cooke declined to comment.

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