Schroders Raises EUR 300 Million for European Subordinated Infrastructure Loan Fund

[Asia Economy Reporter Minji Lee] Schroder Investment Management announced on the 4th that it has raised 312 million euros (approximately 440 billion KRW) in the first subscription of the ‘Schroder Europe Subordinated Infrastructure Loan Fund No. 2,’ launched by the Schroder Group in the first quarter.

This fund attracted institutional investors from major countries including South Korea, the UK, Germany, and Japan. In South Korea, four insurance companies participated, investing about 163 million euros (approximately 230 billion KRW), which accounts for nearly half of the total raised amount.

The fund aims to invest in subordinated loan bonds of infrastructure assets managed within Europe. It plans to raise a total of 750 million euros (approximately 1.05 trillion KRW), with the second subscription scheduled around October. The ‘Europe Subordinated Infrastructure Loan Fund No. 1,’ launched with the same strategy at the end of 2017, raised a total of 350 million euros and deployed most of the funds over two years.

The management of the second fund will be handled by Schroder Aida, the Schroder Group’s infrastructure investment specialist subsidiary. Since its establishment in 2015, Schroder Aida has raised over 3 billion euros from institutional investors worldwide for loan and equity investment funds. The Schroder Europe Subordinated Infrastructure Loan Fund focuses on diversified loan bond investments across multiple countries and sectors, primarily investing in core assets operated by mid-cap companies based in Europe. These assets provide essential services, are capital-intensive, and have high entry barriers. Additionally, they have long usage cycles, generate stable cash flow over extended periods, are protected by market regulations ensuring returns, and carry low technological risk.

The fund plans to review investment opportunities in infrastructure sectors such as water resources and energy companies, renewable energy, power grids, and roads, while integrating ESG (Environmental, Social, and Governance) factors of companies throughout the investment process.

Augustin Segard, Schroder Investment Manager, stated, “The active participation of investors in this fund subscription is based on the high and stable performance of Schroder’s infrastructure loan asset class despite the COVID-19 pandemic. We continue to anticipate positive investment opportunities in the subordinated infrastructure loan bond sector and expect the investment performance of Fund No. 2 to be as successful as Fund No. 1.”

Meanwhile, infrastructure bonds are increasingly emerging as attractive assets for institutional investors due to their defensive characteristics in economic cycles. In particular, subordinated loan bond investments maintain a more favorable credit status compared to other assets with similar credit ratings, enabling income generation in a low-interest-rate environment.

This content was produced with the assistance of AI translation services.