Cabot Square Capital plans to raise £200m (€237m) on the London Stock Exchange by floating a new investment trust to invest in alternative assets as well as alternative asset managers.
Cabot Square Alternatives (ALTS) – which is seeking to raise the capital by issuing shares at £1 each and join the exchange on 18 February – has already received £40m worth of capital commitments from 3 investors.
In an announcement, the company said its investment manager Cabot Square Capital and adviser Cabot Square Alternatives Adviser have indicated to the company that members of their respective teams and affiliates also intend to subscribe for 500,000 shares and the directors of the company intend to subscribe for 125,000 shares.
ALTS will target alternative assets by acquiring direct interests in infrastructure (including renewable energy) and property alternative assets or specialist debt secured against infrastructure and property alternative assets.
The company said no geographic restriction for investments, but the focus will be on the UK and Europe.
Once substantially invested the company is targeting a net asset value total return in the region of 8% to 10% per annum (net of fees and expenses).
ALTS said its manager and adviser have identified a pipeline of £500m of investment opportunities with potential to scale to over £1bn.
Keith Maddin, fund manager and partner Cabot Square Capital, said: “ALTS represents a new model for investors to access returns from investing directly in attractive infrastructure and property alternative assets as well as share in the value creation of specialist alternative asset managers by building alternative asset platforms.
“In addition to delivering target returns we will also focus investment on making a positive ESG impact”.
Charlie Rickets, chairman of Cabot Square Alternatives, said: “We are delighted to announce our intention to launch ALTS and believe that our management team has the experience and expertise to deliver the target returns.
“Given our pipeline, we expect to deploy the initial public offering proceeds efficiently and effectively.”