GLOBAL - Infrastructure managers raised US$6.7bn from global investors in the first quarter, the highest level of fundraising since 2008, but overall deal flow is still at its lowest level since 2006, new research by Preqin showed.
This is the fourth consecutive quarter-on-quarter increase, with $5.9bn raised in the first quarter, $2.4bn raised in the fourth quarter of 2009 and $800m raised in the third quarter.
Most of those assets were raked in by Goldman Sachs for its GS Infrastructure Partners II fund, which raised $3.1bn. The Macquarie Infrastructure Partners II fund raised $1.6bn, the EnCap Energy Infrastructure fund raised $792m, the DIF Infrastructure II fund raised €500m (US$640.6m), the Zachary Hastings Infrastructure fund raised $330m and the Challenger Mitsui Emerging Markets Infrastructure Fund raised US$273m.
Despite the rebound in flows, Preqin said deal activity remained low. Unlisted infrastructure managers reported completing 23 deals, down from 71 deals just two quarters ago and the lowest number since the start of 2006.
"This shows that despite recent positive growth in fundraising, the ongoing contraction of credit markets continues to restrict deal flow," said Preqin.
Europe was the most active region with 10 deals completed; North America followed with seven; Asia, three; South America, two and Australasia, one.
Meanwhile, managers are tempering their fundraising targets. The aggregate target of funds in the markets was $80.8bn in the first quarter, down from $106.8bn two quarters ago.
"Fund managers are reducing fundraising targets an new funds are typically seeking less capital due to continued investor caution and difficult fundraising conditions," Preqin said.
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