AMP Capital, part of Australia’s AMP, has launched the Global Infrastructure Fund and converted an existing open-ended fund into a closed-ended vehicle, called Strategic Infrastructure Trust of Europe, in a drive to target the sector.

AMP Capital, part of Australia’s AMP, has launched the Global Infrastructure Fund and converted an existing open-ended fund into a closed-ended vehicle, called Strategic Infrastructure Trust of Europe, in a drive to target the sector.

SITE’s existing portfolio of $750 million worth of assets will be combined with the Global Infrastructure Fund and SITE will no longer be actively marketed to investors.  The newly launched fund aims to raise a further $1.25 billion of new commitments, giving the infrastructure platform an overall target size of $2 billion.

Separately, AMP Capital said its infrastructure platform has attracted “significant” backing from the private equity firm Pantheon.

The seed assets will provide new investors with access to an existing diversified portfolio of infrastructure businesses including Newcastle Airport, Angel Trains, Alpha Trains, Thames Water, CLH and Greater Gabbard OFTO. Inflows into the Global Infrastructure Fund will be used to acquire new assets in OECD countries in sectors such as transport, communications, and utilities, AMP Capital said in a statement.

The move comes at a time when infrastructure, because it often has inflation-linked revenues and pricing power thanks to government regulation, can be liked by investors seeking to cover liabilities and in a way that is lowly correlated to moves by other assets. Investors such as private banks and family offices, given their time horizons, are said to be among those interested in this asset class area.

“AMP Capital’s Global Infrastructure Fund gives a broader range of investors around the world a new and unique opportunity to tap into an asset class that is going from strength to strength,” Boe Pahari, AMP Capital Head of Infrastructure for Europe and the Americas, and managing partner for the new fund, said.

“There is strong demand for an investment vehicle that can take advantage of the significant investment opportunities driven by the global need for infrastructure.  The platform we have created, which offers new investors immediate access to highly attractive and diversified seed assets, represents an opportunity that we believe is unmatched in the market.  Pantheon’s investment into our global infrastructure strategy is a vote of confidence in what we have created,” he said.

AMP Capital has been investing in infrastructure for more than 25 years, which it says makes it one of the world’s oldest players in this area.