Northill Capital’s recent purchase of Hastings Fund Management, Westpac Group’s Global Infrastructure Manager, is a reminder of the Infrastructure asset class’s enduring popularity with institutional investors. Driven by a confluence of economic, regulatory and industry changes (low prevailing rates, Solvency 2, bank disenfranchisement), many larger managers have spent considerable time and resources in the post-crisis era building out their Real Asset businesses - with Infrastructure being at the top of their list of priorities in the space.
Given the preponderance of boutique, niche houses which have sprung up to service institutional demand for infrastructure assets since 2008, it’s perhaps surprising to see that relatively few independent specialist managers have been acquired by the giants of the industry, who instead have been assiduously pursuing organic, hiring based strategies to build out their infrastructure platforms.
Is it the case that the somewhat self-fulfilling growth of these funds has meant that, quite simply, few have been available? Or, might the answer lie in a relatively healthy supply of bank expertise moving to buyside infra’ platforms– thus negating the need for whole company acquisitions?
What is not in doubt is the relatively bright future for infrastructure investing in the UK and Europe, with a recent IPE survey of institutional investors challenging the notion that infra’ investments are perceived as expensive and two thirds of those surveyed, expecting to increase their allocations to the class over the next 18 months...
Westpac said on Friday it is selling its global infrastructure manager Hastings for about A$160m ($123m) to Northill Capital, the latest in a series of non core asset sales by Australian banks.