Schroders Capital surpasses €330 million for its fifth European infrastructure senior debt fund

Schroders Capital is today announcing that it has raised €335 million for its Schroder Euro IG Infra Debt Fund V (Fund V).

Fund V, which is managed by Schroders Capital’s specialist infrastructure team, aims to invest in European investment grade senior debt opportunities. The fund has a target of raising €750 million in total commitments.

Launched in 2021, this is the fifth vintage of the senior debt strategy whose predecessor, Fund IV, raised almost €680 million.

Fund IV is already more than 80% deployed having previously participated in transactions such as the financing of rolling stock companies, digital infrastructure and those focused on renewable energy.

Fund V will have a similar strategy to Fund IV, with a focus on brownfield debt investments in Europe and a target spread in the region of 200bps. The fund puts an emphasis on delivering diversified debt exposure across sectors and geographies.

Infrastructure debt is an increasingly attractive asset class for institutional investors due to its defensive nature and attractive capital treatment under Solvency II. In particular, investment grade infrastructure debt can help to access healthy yields in the low interest rate environment at lower risk and volatility levels.  

Investors from Europe supported this close, bolstered by a strong re-up rate from clients in Schroder Capital’s previous senior debt strategies, particularly insurance companies.

Jerome Neyroud, Head of Infrastructure Debt Schroders Capital, commented:

“European senior infrastructure debt is protected from many of the challenges encountered in a zero-rate environment and, with this latest fund, investors were keen to take advantage of this asset class.”

Emmanuel Faucquez, Senior Fund Manager & Head of Infrastructure Senior Debt, Schroders Capital, commented:  

“The strong investor appetite seen for this fifth vintage fund continues to demonstrate continued robust demand and performance of the asset class through the pandemic. It is a testament to the relevance and consistency of our investment strategy over the last six years across several market cycles.”

Peter Arnold, Head of Private Asset Sales, Schroders Capital, commented:

“The strong re-up rate, with 80% of commitments coming from existing clients in our previous vintages, is a testament to the team’s outstanding track record.

“We are incredibly grateful for the backing and trust shown by our existing global partners, as well as new clients that have joined this first close. We will continue to aim to deliver investment performance that meets their needs.”

Earlier this month, the Schroder Euro Enhanced Infrastructure Debt Fund II (Julie II) reached its hard cap of €1 billion. Julie II focuses on European comingled junior debt investments and has so far deployed 25% of its capital in four transactions.

As part of Schroders Capital, the specialist infrastructure team provides investors with access to resilient and sustainable returns from essential infrastructure in Europe across the capital structure (senior debt, junior debt and equity).

It has invested €2.8 billion* in over 80 infrastructure transactions across the capital structure in 14 European countries and 10 sub-sectors over the past last five years.

Schroders Capital is the private market investment arm of Schroders, the global asset management group. It offers investors a local approach to investing across a broad range of private asset strategies, supported by a global perspective. Across private assets and alternatives, Schroders Capital has $66 billion* in assets under management.

*As at 31 March 2021