KKR’s third infrastructure fund, which seeks to invest in core, income-producing infrastructure assets globally, has raised $7.4bn (€6.35bn) at final close.
The manager said KKR Global Infrastructure Investors III received strong backing from a diverse group of new and existing global investors, including public pensions, sovereign wealth funds, insurance companies, family offices, high net worth individual investors and other institutional investors.
IPE Real Assets reported in February that Minnesota State Board of Investment had approved a $150m commitment to Infrastructure III.
The capital raised by the latest fund is more than double the amount the manager raised for the previous fund, Global Infrastructure Investors II, which raised $3.1bn in 2015. KKR’s infrastructure business now manages around $13bn in assets under management.
The fund will pursue infrastructure investment opportunities with an emphasis on investments in OECD countries predominantly in North America and Western Europe.
KKR said it will be investing $358m in capital alongside external investors through KKR’s balance sheet and employee commitments.
Raj Agrawal, a member of KKR and the global head of the infrastructure business, said: “The current scale of global infrastructure investment demand is simply enormous, and is only growing, with the need outstripping capital available.
“This dynamic, coupled with limited public financing sources, has created a significant need for private capital to provide infrastructure solutions. We believe our sector expertise and global platform uniquely position us to help fill this funding gap and we look forward to our continued growth in, and commitment to, the infrastructure asset class.”
Alisa Amarosa Wood, a member of KKR and head of the firm’s private market products group, said: “Since first launching the fund, we were thrilled to see the incredible momentum we received from investors – both those who were early and large supporters of our predecessor funds and also those who were first-time investors with us as well as the asset class.
“The enthusiasm we saw across all geographies and investor types demonstrates the strong support for our infrastructure team, strategy and investment performance to date. Additionally, we have seen infrastructure as an asset class mature and grow in the way investors allocate capital to the space.”
Recent transactions by the fund include Starlight, which owns a portfolio of around 10,200 telecommunication towers across France, and Discovery Midstream, a private natural gas gathering and processing business in Colorado’s Denver-Julesburg Basin.