KKR, a global alternatives asset management firm, has announced the final close of its Asia Pacific Infrastructure Investors II SCSp, a $6.4bn fund focused on infrastructure-related investments across the region.
The fund received backing from a range of new and existing global investors across the world, including public and corporate pensions, sovereign wealth funds, insurance companies, endowment funds, and asset managers, said KKR in a statement.
At close, the fund is the largest pan-regional infrastructure fund to have been raised for Asia Pacific. More than half of the fund is already invested or committed across about 10 investments, it said.
“The success of the fundraise is a testament to the confidence that global investors have in our ability to deliver strong risk-adjusted returns and differentiated value-add through our established multi-asset platform, local presence in key markets, and strong ability to collaborate across multiple strategies and the region,” David Luboff, co-head of KKR Asia Pacific and head of Asia Pacific infrastructure at KKR.
KKR’s inaugural Asia Pacific-dedicated infrastructure fund, KKR Asia Pacific Infrastructure Investors SCSp, raised $3.9bn in 2021, which was the largest Asia-dedicated pan regional fund at the time. KKR’s Asia Pacific infrastructure platform has organically grown to approximately $13bn in assets under management since its inception in 2019.
“Infrastructure is a key pillar of KKR’s global and regional strategy,’ Luboff added.
The new fund will focus on infrastructure with low volatility and strong downside protection where KKR believes it can add value and achieve attractive risk-adjusted returns. The fund has a broad investment mandate across various sectors, including renewables, power and utilities, water and wastewater, digital infrastructure, and transportation.
Hardik Shah, a partner on KKR’s infrastructure team based in Mumbai, said, “As Asia accounts for more than 60% of global growth, driven by rising domestic consumption and productivity, rapid urbanization, and an enormous emerging middle class, the need for new infrastructure and sustainable energy sources will continue to accelerate”.
KKR’s regional infrastructure investments include $800m for a 20% stake in Singtel’s regional data centre, $650m in Serentica Renewables, a decarbonization platform in India, and $400m in OMS Group, a provider of subsea cable services with a focus on Asia.
KKR first established its global infrastructure team and strategy in 2008. The firm now manages approximately $56bn in assets across more than 80 infrastructure investments and has a team of around 90 dedicated infrastructure investment professionals globally.
“KKR has built a differentiated infrastructure investing approach that combines our decades-long experience of being a value-add investor, having localized teams, and maintaining a focus on downside protection,” said Brandon Donnenfeld, a managing director in KKR global client solutions.