Saudi Arabia's PIF commits capital to new regional infrastructure fund

Sovereign wealth fund contributes up to 20% of the total size of the Aberdeen Standard Investcorp Infrastructure Partners fund

A new regional fund, formed as a JV by Investcorp and Aberdeen Standard Investments, received a capital commitment from Saudi Arabia's Public Investment Fund. Courtesy Investcorp

Saudi Arabia's sovereign wealth is investing in a regional infrastructure fund set up by Bahrain's Investcorp and Aberdeen Standard Investments.

The Public Investment Fund contributed up to 20 per cent of the total size of the Aberdeen Standard Investcorp Infrastructure Partners’ (ASIIP) fund ahead of its expected first closing, Investcorp said in a statement on Thursday. The size of the fund was not disclosed.

"Investing in infrastructure is critical for supporting long-term economic growth," Hazem Ben-Gacem, co-chief executive of Investcorp, said. "Today’s uncertain and challenging economic environment has created a gap between the need to develop or upgrade critical infrastructure and the resources available for such projects."

PIF's investment is in line with its aim of building strategic partnerships, unlocking economic opportunities, and deploying capital to support sectors with significant long-term growth potential.

ASIIP has also received board approval from the Asian Infrastructure Investment Bank (AIIB) to commit $90 million, Investcorp said.

The Manama-based alternative investment firm expects other global institutional investors to join the fund, including pension funds, insurance companies, endowments, family offices and private clients.

ASIIP aims to contribute to the economic diversification push in the Gulf and Middle East and North Africa region by investing in sustainable core infrastructure projects, Investcorp said.

The fund will deliver services in healthcare, education, water, mobility and digital infrastructure.

"ASIIP identified significant opportunities in Saudi Arabia and the region," Sami Neffati, managing partner of Aberdeen Standard Investcorp Infrastructure Partners, said. "We are drawing on our unrivalled network of global relationships and expertise to foster foreign, regional and local investment in sustainable infrastructure that preserves the environment, and serves communities and future generations.”

Earlier this month, Investcorp said it plans to delist its shares from the Bahrain Bourse as it charts the next phase of its growth.

The alternative asset manager, which counts Mubadala Investment Company as its biggest shareholder and manages $35.4bn of assets, has received shareholder approval for a board recommendation to delist and convert the company into a closed shareholding entity.