Barings has closed its first closed-end infrastructure debt fund with $630 million of commitments.
The Target Yield Infrastructure Debt Fund and associated vehicles beat the initial target of $500 million. The firm said it attracted interest from investors around the world including public and private pension funds and insurance companies.
Barings has been investing in infrastructure debt for 30 years and in 2013 set up a dedicated team to invest in the asset class from separately managed accounts. It decided to launch its latest fund following demand from its investors for a closed-end, commingled fund.
Target Yield Infrastructure Debt Fund will invest in below-investment grade infrastructure debt including renewable energy and associated sectors, transportation and digital infrastructure. It will primarily focus on senior loans but has the ability to take junior positions in the capital structure.
Pieter Welman, managing director and head of Barings Global Infrastructure, said: “We have been making investments in infrastructure debt on behalf of our parent company for years. We view this inaugural fund as a natural evolution of our historical infrastructure debt strategy, focused on the same sectors and types of credits.”
The fund has a 10-year lifespan and expects to be more than 60 percent invested by the end of Q3 2022, with full deployment expected at some time in 2023.
Since creating its dedicated infrastructure debt business, Barings has invested more than $18 billion across 300 transactions, with $3.4 billion deployed in the past 18 months.