Australian, Canadian pension funds pledge $2 billion in NIIF

The National Investment and Infrastructure Fund Ltd (NIIF) Tuesday said it has received commitments of about $2 billion from AustralianSuper, Australia’s largest superannuation and pension fund, and Ontario Teachers’ Pension Plan (Ontario Teachers’), one of Canada’s largest single-profession pension plans.

These include commitments of $250 million each into NIIF’s master fund, and co-investment rights of up to $750 million each in future opportunities alongside the master fund.

The investment also makes AustralianSuper and Ontario Teachers’ shareholders in NIIF.

The fund also received additional commitments worth ₹60 crore from HDFC Life and Kotak Mahindra Life Insurance in the third round.

“We are delighted to welcome two of the world’s leading pension funds as investors in the NIIF master fund and as shareholders of National Investment and Infrastructure Fund Ltd, alongside other eminent investors. AustralianSuper and Ontario Teachers’ are among the most respected infrastructure investors in the world and bring considerable global perspective and value to NIIF,” said Sujoy Bose, managing director and chief executive officer, NIIF.

“Their significant investments demonstrate the international interest in Indian infrastructure and reconfirms the many strengths of NIIF, which positions it as one of the primary Indian pooling vehicles for global capital,” he added.

NIIF, which was set up in 2015 along the lines of a sovereign wealth fund with 49% equity held by the Union government, looks to boost infrastructure financing in the country. The latest investment pegs the NIIF master fund as the largest infrastructure fund in India with assets of over $1.8 billion under management and a co-investment pool of $2.5 billion.

Master fund had earlier raised capital from UAE’s sovereign wealth fund, Abu Dhabi Investment Authority (ADIA), Singapore’s state investment arm Temasek, HDFC Group, ICICI Bank, Kotak Mahindra Life Insurance and Axis Bank.

While Temasek had agreed to invest $400 million into NIIF’s master fund in 2018, ADIA had committed $1 billion in 2017 along with other domestic private sector investors, which together invested ₹500 crore in the fund.

The fund, with a 15-year tenure, is denominated in Indian rupees and invests in equity capital in core infrastructure sectors in India with a focus on transportation, energy and urban infrastructure. It made its first investment last year by partnering with Dubai-based DP World to buy Continental Warehousing Corp., one of the largest logistics companies in India. Hindustan Infralog, the $3-billion ports and logistics platform created by NIIF and DP World, seeks to invest in ports, terminals, transportation and logistics.

With over $3 billion of capital commitments across three funds—‘master fund’, ‘fund of funds’ and ‘strategic fund’, NIIF looks to invest in operating assets, greenfield projects and anchor third-party managed funds in core infrastructure and related segments.

“India’s burgeoning infrastructure market is among the largest in Asia, which presents many opportunities for investment. We are pleased to have entered into this agreement with the NIIF master fund and to be shareholders of NIIF and look forward to participating in a strong pipeline of projects across a range of sectors,” said Mark Delaney, chief investment officer, AustralianSuper.