Mexico Courts BlackRock, KKR to Ramp Up Infrastructure Projects

Claudia Sheinbaum Photo by Stephania Corpi /Photographer: Stephania Corpi/Bl

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(Bloomberg) — Top officials from Mexican President Claudia Sheinbaum’s government have met with asset managers including BlackRock Inc., KKR & Co. and Macquarie Asset Management as her country looks to jump-start private investment in infrastructure development.

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The firms attended a lengthy workshop last month that also included representatives from Copenhagen Infrastructure Partners, Mexico Infrastructure Partners and Alom Infra, according to people with knowledge of the matter.

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Despite courting global investors and Mexican pension funds since early last year, Sheinbaum’s government has yet to put together specific special-purpose vehicles that could draw significant private investment. But a recent pickup in private investment in Mexico’s struggling electricity sector suggests the government may be gaining some momentum.

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Conversations at the June meetings focused on discussing the framework for the potential projects rather than on a specific new investment pipeline, according to the people, who asked not to be identified discussing information that isn’t public. Government officials expressed interest in developing projects in energy and the highway space in the near term, the people said.

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The meetings also included a breakfast with Finance Minister Edgar Amador at which representatives from the country’s pension funds, known as Afores, were in attendance, some of the people with knowledge of the matter said.

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“Pension savings have a long-term horizon, making them naturally compatible with the financing of well-structured infrastructure projects,” Guillermo Zamarripa, president of pension-fund association Amafore, said in a statement. “This type of investment contributes to diversification while offering reasonable returns. Mexico needs infrastructure investment.”

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Representatives for BlackRock, KKR, Copenhagen Infrastructure Partners and Mexico Infrastructure Partners declined to comment. A representative for Alom Infra confirmed someone from the firm attended the workshop, but didn’t provide further details.

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The gathering was “overall a positive meeting as it gave asset managers the opportunity to speak directly with the government about infrastructure investment,” Ernesto Gonzalez, Macquarie Asset Management’s Mexico head, said in an emailed statement. “One of the topics that came up was the importance of a framework for engagement. A stable regulatory environment and arbitration process for dispute resolution are essential for attracting and retaining investment needed to drive major infrastructure projects in Mexico.” 

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Macquarie has invested in Mexico for nearly two decades.

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The meetings come as plans for private investors to put capital to work have languished and amid some impatience from investors the government expects to tap for funds. Those investors include Afores, sitting atop some $500 billion in assets, which is expected to balloon in coming years. In May, the government unveiled efforts to roll back red tape, and Congress has approved legislation proposed by Sheinbaum aimed at speeding up authorization of investments in major infrastructure projects.