Balfour Beatty, the international infrastructure group, announces that its infrastructure funds management business, Balfour Beatty Infrastructure Partners (BBIP), has reached first close on its first fund.
In November 2010, Balfour Beatty plc announced plans to set up a funds management business. Our objective was to utilise a combination of infrastructure asset knowledge, skills and experience that has accumulated within the Group, particularly in the Infrastructure Investments division and Parsons Brinckerhoff, to earn a superior return on capital as well as advisory fees. A funds management business would also leverage our capabilities into greater pools of capital while diversifying risk to the Group.
This business, BBIP, was set up in 2011, with the recruitment of four senior individuals. Since then they have worked on obtaining the relevant registrations, establishing a presence in London and New York, identifying investors and pursuing the appropriate initial assets for the fund to invest in.
Today, the BBIP fund reached first close with US$317 million (£200 million) of commitments, of which Balfour Beatty plc has committed US$110 million (£70 million). Subsequent levels of close are expected during the course of 2013, ultimately reducing Balfour Beatty plc’s share in the fund to c.10%. Drawdowns will be dependent on the timing of investments by the fund, but it is anticipated that Balfour Beatty plc’s commitment will be invested over the next 3-4 years.
The fund will make investments in predominantly brownfield (operational) assets into its key target sectors of transport, energy and utilities across the UK, Europe, and North America.
Source: Balfour Beatty plc Stock Exchange release January 2013.