Australian and Canadian pension funds to invest a billion dollars each in NIIF

Our Bureau Mumbai | Updated on August 07, 2019

The fresh investments will enable NIIF to invest in large infra projects   -  P_V_SIVAKUMAR

AustralianSuper and Ontario Teachers’ to become shareholdersin fund’s asset manager

AustralianSuper, Australia’s largest superannuation fund, and Ontario Teachers’ Pension Plan, Canada’s largest single-profession pension plan, will invest $1 billion each in the National Investment and Infrastructure Fund (NIIF) of India’s Master Fund.

The agreements in this regard include commitments of $250 million each and co-investment rights of up to $750 million each in future opportunities alongside the Fund. This is the third round of investments into the fund, making it the largest infrastructure fund in India with assets under management of over $1.8 billion and a co-investment pool of $2.5 billion. Domestic investors HDFC Life and Kotak Mahindra Life Insurance have further committed ₹60 crore in the third round.

AustralianSuper and Ontario Teachers’ will now join the Government of India, the Abu Dhabi Investment Authority, Temasek, the HDFC Group, ICICI Bank, Kotak Mahindra Life Insurance and Axis Bank as investors in the fund. They will also become shareholders in National Investment and Infrastructure Fund Ltd, NIIF’s investment management company.

Focus areas

The fresh investments will enable the NIIF to invest at the scale required for the large infrastructure requirements of India. The fund invests in the equity capital in core infrastructure sectors with a focus on transportation, energy and urban infrastructure.

The Master Fund has a tenure of 15 years and is denominated in Indian rupees to suit the requirements of the infrastructure sector. Under the fund, a $3-billion ports and logistics platform — Hindustan Infralog Private Ltd (HIPL) in partnership with DP World — was set up in 2018.

Sujoy Bose, Managing Director & Chief Executive Officer of NIIF, said: “AustralianSuper and Ontario Teachers’ are among the most respected infrastructure investors in the world and bring considerable global perspective and value to NIIF. Their significant investments demonstrate the international interest in Indian infrastructure and reconfirms the many strengths of the NIIF, which positions it as one of the primary Indian pooling vehicles for global capital.”

Mark Delaney, Chief Investment Officer with AustralianSuper, said: “India’s burgeoning infrastructure market is among the largest in Asia, which presents many opportunities for investment.”

The NIIF was set up in December 2016 with a planned corpus of ₹40,000 crore. The Indian government has 49 per cent stake in the NIIF with the rest held by marquee foreign and domestic investors. The NIIF manages over $4 billion of capital commitments across three funds — the Master Fund, the Fund of Funds and the Strategic Fund.

Published on August 06, 2019

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