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Is Brookfield Biting Off More Than it Can Chew?

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According to data from the Sovereign Wealth Fund Institute (SWFI), increasingly asset owners such as sovereign wealth funds and large pensions have augmented allocation to unlisted infrastructure. The money flows have created bubbles in the world of private infrastructure, forcing asset owners, managers and other investors to pay more for infrastructure assets. Toronto-based Brookfield Asset Management, within a nine-month span, raised the biggest private infrastructure fund in history – closing US$ 14 billion in equity commitments for Brookfield Infrastructure Fund III. The original fundraising target was US$ 10 billion. Brookfield Infrastructure Fund III, which targets core infrastructure assets on a value basis, has a four-year investment period that will last 12 years – subject to annual extensions. To be fair, US$ 4 billion of that amount is being committed by Brookfield Infrastructure Partners L.P. and Brookfield Renewable Partners L.P. However, US$ 6.2 billion was committed from 77 new investors, which include fresh backers from China, Japan and South Korea, out of 120 investors. Asian investors such as Korean pensions are eager to push capital toward single-digit generating illiquid infrastructure assets. Even so, the surging demand for investments outside the volatile world of listed equities and negative interest rates in government bonds have created substantial demand for real assets.

That limited partner money would be at substantial political risk, as Brazil is undergoing a tumultuous period of exposed corruption.

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Scatec Solar Places Big Solar Bet in Bangladesh

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Oslo-based Scatec Solar ASA, a publicly-traded independent power producer operating in the emerging market solar development space, plans to construct and own a 800 mega watt photovoltaic solar power plant in Chandpur, Bangladesh. Scatec Solar has solar assets scattered across numerous emerging markets such as South Africa, Rwanda, Honduras, Egypt, Jordan and the Czech Republic.

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APFC Sells $1.4 Billion Stake in Simpson Housing

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The Alaska Permanent Fund Corporation (APFC) embarked on a major shift in its real estate portfolio by selling a 50% ownership stake in Denver-based Simpson Housing LLLP for US$ 1.4 billion. Simpson Housing had made up roughly 24.7% of APFC’s US$ 5.6 billion real estate portfolio. The other owner of Simpson Housing is that State of Michigan Retirement Systems.[ Content protected for Sovereign Wealth Fund Institute Standard subscribers only. Please subscribe to view content. ]

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ISIF Invests in Cybersecurity Firm Vectra

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The Ireland Strategic Investment Fund (ISIF) committed €10 million to Vectra Networks, Inc., a San Jose, U.S.-based cybersecurity company. The investment capital will assist Vectra in creating a research and development center in Dublin.

ISIF is part of a larger funding round of €30 million. These other investors include Khosla Ventures, Accel Partners, DAG Ventures, AI Ventures, AME Cloud Ventures and Wipro Ventures.

Kevin Dillon, who is the former Head of Microsoft Ireland and a Managing Partner at Atlantic Bridge, will join the board of directors at Vectra.

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