Evli's new global infrastructure fund, Evli Infrastructure Fund I Ky, successfully raised a total of EUR 154.7 million in its last closing in May 2021.
Finnish institutional and retail investors have shown strong interest in the infrastructure asset class and in the fund. The investor base of Evli's infrastructure fund, which was launched in the spring of 2020, consists of both professional institutional investors, such as pension funds, non-profit foundations, unions and associations, and high net worth individuals. Evli Infrastructure Fund I offers investors access to the world's leading infrastructure funds in a diversified manner.
"I believe that this strong interest is driven by the increased need of our clients to diversify their investment portfolios, and also by the uncertainty brought by the coronavirus pandemic. Infrastructure is an asset class that has been less affected by the current global environment – as a defensive real asset class, it offers steady and predictable returns through the economic cycles and has a low correlation with other asset classes," says Richard Wanamo, Portfolio Manager of the Evli Infrastructure Fund.
"In general, infrastructure companies provide critical services to society, which means they have a protected competitive position. They generate stable and strong annual cash flows – which is particularly attractive in a low interest rate environment," Wanamo continues.
As a result of these characteristics, the infrastructure asset class has been one of the most attractive asset classes in international surveys of professional institutional investors (Preqin, 2020). In the future, the need for private capital to implement infrastructure investments will become even more pronounced as population growth, urbanisation and the shift to renewable energy significantly increases the need for global infrastructure investment in the 2020s. This will bring a significant number of additional properties within the reach of investors, further increasing the attractiveness of the asset class.
Responsibility, diversification and careful investment selection are most essential in portfolio management
Evli Infrastructure Fund I aims to diversify its investments globally into around eight carefully selected infrastructure funds (approximately 100 target companies in total). The target funds invest in companies whose business is based on the operation and development of civic infrastructure, such as telecommunications, utilities, transport and social infrastructure.
To date, the fund has already made investment commitments to five infrastructure funds that invest in different types of infrastructure projects both in Europe and globally, for example, to Arcus European Infrastructure Fund 2, Antin Infrastructure Partners IV, DIF Infrastructure VI and Partners Group Direct Infra 2020. Already with these commitments, the fund has achieved a good geographical and sectoral diversification. The vast majority of the target investments are in operational sites, but there are also projects under construction, building entirely new infrastructure or expanding existing sites. In this way, the fund can achieve not only good cash flow returns but also attractive returns from value creation.
Evli Infrastructure Fund I, like all of Evli’s other funds, takes sustainability, i.e., environmental, social and governance (ESG) factors, into account in its investment activities and decision-making processes. Each targeted infrastructure fund is subject to an in-depth sustainability analysis and assigned its own ESG rating based on an assessment by the Evli investment team. Evli will not invest in funds whose managers are not committed to responsible investment practices.
"Sustainability is a very important theme in infrastructure investing, and we require that the assets in our portfolio, which provide vital services to society, are operated and developed in a responsible manner. Investments in renewable energy also directly support the world's transition to cleaner electricity generation and are in line with the UN Sustainable Development Goals," says Richard Wanamo.
Highly experienced investment team brings added value in fund selection
In a career spanning more than 15 years, Portfolio Manager Richard Wanamo has made over EUR 4 billion in investment commitments to infrastructure funds, private equity funds and other illiquid alternative investment funds, and has served on the advisory boards of several funds.
"Our aim is to create added value for our clients through fund selection, which would not be possible without the experience of Wanamo and Evli's more than 20-strong alternative investment portfolio management team and their excellent network in the target markets of the funds. A reliable, established, and experienced player like Evli is an important support for investors. It enables access to the funds of the best performing managers," says Tero Tuominen, Managing Director at Evli Fund Management Company.
In 2022, Evli intends to open a follow-on fund for Evli Infrastructure Fund I Ky with the same investment strategy, after the first fund has made its final investment commitments.
The development and offering of alternative funds are key parts of Evli's strategy, with total client assets under management already exceeding EUR 1.2 billion (31.3.2021). Alternative investment funds are aimed at professional investors and a limited number of non-professional clients who are considered to have a sufficient understanding of the funds and their investment activities, and who wish to diversify their investments outside traditional asset classes.
For more information and interview requests:
Richard Wanamo, Investment Director, Private Assets, Evli Fund Management Company Ltd, tel. +358 50 441 0294, richard.wanamo@evli.com
