Muzinich & Co targets up to $1bn for new infrastructure private debt strategy
Muzinich & Co has teamed up with Asian investment platform Orion3 to launch an infrastructure and real assets private debt strategy.
The fund has already raised $120m (£90.9m) in seed capital and is targeting a size of between $500m and $1bn. It is aiming to provide returns in the low teens.
The new strategy will provide debt financing and capital solutions for middle-market infrastructure and real asset companies, to support them in their transition to net zero, according to a company statement.
The vehicle will help address the growing funding gap in global infrastructure investment, which is expected to widen to $15tn by 2040, according to a Global Infrastructure Hub report.
The strategy will initially focus on opportunities in Australia, Singapore, South Korea, Japan, Hong Kong, the UK and Canada. It will also be able to invest in deals in South East Asia, the Middle East and EU regions.
“Expanding our private debt offering into infrastructure and real assets will enable clients to participate in the much-needed investment in sustainable infrastructure, while also providing diversification and a potential illiquidity premium over other asset classes,” said Justin Muzinich, chief executive of Muzinich & Co.
Private credit funds have increasingly been circling the infrastructure space for opportunities.
A whitepaper published earlier this year by Ares Management suggested that infrastructure debt could present a $1.5tn opportunity for private lenders over the next five years.
In September 2023, Bridgepoint announced its planned $20bn acquisition of North American infrastructure investor Energy Capital Partners and in May this year, Principal Asset Management announced the launch of its new private infrastructure debt capability, hiring MetLife veteran Mansi Patel to lead the new team.
