Govt-backed fund to raise $4 b for infra

The National Investment & Infrastructure Fund (NIIF), backed by the Indian government and several global investors, plans to raise $4 billion early next year. This would be the NIIF’s largest-ever fund raise.

The NIIF, which resembles a sovereign fund, is also raising capital for its private markets fund, and will consider a new private equity fund after the infrastructure fundraise, The Economic Times has reported, quoting unnamed sources.

The new fund would be much larger than the predecessor Master Fund that closed in December 2020 with $2.34 billion, and would mark a restart of activities under a new chief executive officer, the news report said.

The firm underwent a rough patch with its biggest shareholder the Indian government over resource allocation and direction, Bloomberg earlier reported.

Other NIIF backers include heavyweights Abu Dhabi Investment Authority (ADIA), AustralianSuper, and Singapore’s Temasek Holdings Pte. Indian lenders HDFC Bank Ltd., ICICI Bank Ltd. and Axis Bank Ltd. are also investors. NIIF expects to collect more capital as co-investment commitments from its backers in this fundraise, according to one of the people familiar.

NIIF has four funds across different asset classes. The Master Fund is the largest that invests in infrastructure. The other funds include a private markets fund, a strategic opportunities fund that takes direct stakes in companies, and an India-Japan private equity fund focused on environment preservation.

The Master Fund recently invested in iBUS Network and Infrastructure Pvt, an infrastructure solutions company. Other investments include renewable energy platform Ayana Renewable Power Pvt and IntelliSmart Infrastructure Pvt, a smart meter platform. The Master Fund is also an owner in Athaang Infrastructure Pvt, which is looking to sell some toll road assets, Bloomberg News reported.