India’s premier financial institution IFCI Ltd. is partnering with global investment firm Sycamore Ventures to establish a $500 million infrastructure fund, which will be jointly managed by IFCI & Sycamore. This partnership brings together unique and wide ranging local and international investment expertise as well as long-standing and deep understanding of the infrastructure space. As the principal sponsor to the fund, IFCI has committed to invest 10% of the total capital of the fund with a minimum commitment of $50 million.
The Fund intends to consummate investments in equity and/or equity related instruments of infrastructure projects or holding companies, with demonstrable, sustainable cash flow models and potential for significant long term capital appreciation. The Fund’s focus includes all forms of power generation, transmission and distribution, gas distribution, coal mines, roads, bridges, railways, ports, airports, warehouses & logistics businesses.
IFCI & Sycamore have a robust existing investment pipeline and anticipate continuing strong demand for investment capital in the infrastructure sector over the foreseeable future. The Fund will raise capital from domestic and overseas investors and will be registered with SEBI as a Venture Capital Fund (VCF). Foreign subscribers will invest in the VCF through a Mauritius fund with domestic subscribers investing directly in the VCF.
India’s annual GDP growth of 7% - 9% has led to enormous opportunities for private participation in alleviating wide ranging infrastructural deficits. Favorable policy environment combined with targeted investment of US$ 1 trillion in infrastructure in the Government’s twelfth Five Year Plan has created unparalleled potential for mobilizing private capital in infrastructure. IFCI and Sycamore believe that their joint venture will create a unique platform to enable global capital to harness vast opportunities for investment and development of Indian infrastructure.
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