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IDFC, Blackstone, Citi raise $900m for Indian infrastructure

The Indian Infrastructure Fund, initiated by IDFC and the Indian government, aims to raise $5bn in debt and equity to invest in India's transport, telecommunication infrastructure and power sectors.

The India Infrastructure Fund has raised $900 million to date, a market source told sister website PEO.

The fund is a joint venture between the Indian government, Citi, The Blackstone Group and India’s Infrastructure Development Finance Company. It was launched in February and is targeting $5 billion in equity and debt to fund infrastructure development in India.

The joint venture will raise $1.25 billion in equity for the first tranche of the fund, and that the amount “should be raised shortly”, the source added.

IDFC, Citi and Blackstone have committed $250 million to the fund. The International Finance Corporation, the private investment arm of the World Bank, has committed $100 million.

India Infrastructure Fund broadly invests in energy, transport infrastructure and telecommunications infrastructure. Its main focus is on electricity generation and transmission, oil and gas pipelines, storage and processing facilities, roads, railways, ports, airports, and broadcast and mobile towers. It has made five investments thus far.

The equity financing for the initiative is being managed by IDFC, while debt financing is being channelled through India Infrastructure Finance Company, a state-owned institution. The fund is managed by IDFC Project Equity, a subsidiary of IDFC which mobilises and manages third party funds to invest in asset level equity, quasi-equity and convertibles.

IDFC Private Equity, which is the private equity investment arm of IDFC, closed IDFC Private Equity Fund III on INR33 billion ($700 million; €495 million) earlier this year to make private equity infrastructure investments.

IDFC Project Equity declined to comment.