Morgan Stanley raises $300 million for India focused infrastructure fund

Mumbai: Morgan Stanley has raised close to $300 million in commitments for its India-focused infrastructure fund and is expected to make a formal first close soon, two people aware of the development said.

The fund is Morgan Stanley’s maiden India-dedicated infrastructure fund.

“Morgan Stanley, which has been in the market for sometime now for raising this fund, has managed to raise commitments to the tune of close to $300 million so far, which will help it make a first close soon and thus start deploying capital,” said one of the two people cited above, requesting anonymity.

Morgan Stanley is looking to raise around $600-700 million in total for the fund, he added.

The fund-raising comes at a time when infrastructure spending in India has seen a dramatic increase and private capital has been making a beeline for such assets.

In May, financial services group Edelweiss said it had achieved the targeted base offering size of «¤??2,000 crore for its infrastructure sector-focused fund—Edelweiss Infrastructure Yield Plus Fund. The fund aims to raise an additional «¤?? 4,500 crore in the next 12 months.

This year has also seen the entry of new investment firms in the Indian infrastructure space.

Rohatyn Group, a specialized asset management firm focused on emerging markets, acquired the J.P. Morgan Asian Infrastructure and Related Resources Opportunity (AIRRO) platform in May.

Global Infrastructure Partners, one of the largest global infrastructure funds, acquired two infrastructure funds business of IDFC Alternatives Ltd.

According to the second person cited above, the Morgan Stanley infrastructure fund will focus on infrastructure allied sectors.

“Unlike other funds in the market that are looking largely at hard assets such as roads and power, the Morgan Stanley fund will be looking at investing in social infrastructure sectors such as healthcare and education as well. The fund will look to own operational assets in these spaces as well as fund greenfield projects,” he said. He too requested anonymity.

Emails sent to Morgan Stanley on Friday did not elicit any response.

In September, The Economic Times reported that the fund has received an anchor investment commitment of $150 million from Beijing-based Asia Infrastructure Investment Bank and was in talks with sovereign funds from the Middle East and South-East Asia.

Earlier in June, sovereign wealth funds GIC Holdings Pte Ltd and Abu Dhabi Investment Authority (ADIA) said that they will invest a combined $450 million (around «¤?? 3,000 crore) in Greenko Energy Holdings in one of the largest funding rounds by an Indian clean energy producer. In April, Canada Pension Plan Investment Board, invested $247 million in ReNew Power Ltd to help it acquire 1.1 gigawatts (GW) of renewable assets from Ostro Energy Pvt. Ltd.

Disclaimer: This information has been collected through secondary research and IBEF is not responsible for any errors in the same.