ICG Raises €3.15 Billion for Second European Infrastructure Fund

A construction site. Photographer: Milan Jaros/Bloomberg Photo by Milan Jaros /Bloomberg

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(Bloomberg) — Asset manager ICG Plc has raised €3.15 billion ($3.7 billion) of commitments for its second European infrastructure fund, supported by strong demand from North American investors eyeing investment opportunities in the region.

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ICG Infrastructure Fund II was oversubscribed and surpassed its initial fundraising target of €2 billion, according to a statement seen by Bloomberg News. It’s more than double in size from its preceding fund, ICG Infrastructure Equity I, which raised €1.5 billion in 2022. The strategy primarily invests in mid-market businesses across the energy transition, digital and mobility sectors.

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“There has been a significant surge in interest from North American investors,” Guillaume d’Engremont, head of infrastructure at ICG, said in an interview. While Fund I had less than €100 million from the US and Canada, it’s close to €1 billion from that region for Fund II, representing nearly a third of its total capital, he said. 

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The fundraising was also helped by the strategy’s performance, with the previous vehicle so far giving investors distributions equal to 81% of paid-in capital supported by three deals in the last 18 months, d’Engremont said. DPI — a measure of how much cash is generated by a fund relative to what’s been invested — is being seen by investors as the best way to evaluate performance and has become a kind of lodestar for the industry, particularly when it comes to fundraising. 

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The fund agreed in March to sell renewable energy firm Akuo to private equity firm Ardian. Last year, it struck deals to sell fiber company Oceinde Communications to Crédit Agricole Assurances, as well as water and heat submetering infrastructure provider Ocea Group to EQT AB. 

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D’Engremont launched ICG’s infrastructure strategy in 2018, when he joined with his team from EDF Invest, according to the asset manager’s website. This industrial background, and ICG’s structured equity products offering, represent a differentiated approach to the European mid-market infrastructure space, he said.

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ICG is focused on two key trends in Europe, namely energy transition and digitalization, as “these areas offer predictable investment opportunities” despite broader market uncertainties, according to d’Engremont.

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The latest vehicle will aim for more diversification, targeting 12 to 15 investments compared to the eight in Fund I, he said.

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