Direct infrastructure

Mandate · Portfolio


Mandate

PKA AIP pursues investment opportunities in essential infrastructure assets on behalf of PKA and potentially other institutional investors. In 2018 PKA AIP launched the third investment program, PKA AIP 3 Direct, in continuation of PKA AIP 1 and 2 Direct with EUR 1.8 billion (DKK 13.5 billion) in assets under management. From 2018 PKA AIP expects to deploy EUR 500 – 600 million annually in the PKA AIP 3 Direct program corresponding to a total investment volume of EUR 1.5 – 1.8 billion (DKK 11 – 13 billion) from 2018 to 2021.

The focus for PKA AIP 3 Direct is to build a portfolio of complementary infrastructure assets, characterized by long duration, stable, and contracted cash flows with material downside protection, controllable risks and strong governance structures. To achieve this, we look for infrastructure assets located in Northern and Western Europe as well as United States, where regulatory regimes have historically been stable. We enter into long-term partnerships with utilities and asset managers with a stake in the long-term performance of the assets, which helps to ensure alignment with the ultimate beneficiaries of PKA pension funds.

The main investment criteria for PKA AIP are as follows:

  • Cash profile: Long duration cash flows with a significant fixed cash component
  • Ticket size: EUR 70-500 million (DKK 0.5-3.5 billion) per investment
  • Geography: Northern & Western Europe and Unites States
  • Financial instrument: Equity, mezzanine, or subordinated debt
  • Partnership model: Strong alignment with an operationally skilled Tier-1 asset manager
  • Stage: Greenfield construction-ready or operational infrastructure assets
  • Costs: Low deployment costs per unit of invested capital and low monitoring costs

Portfolio - Direct Infrastructure

PKA AIP has invested EUR 1.9 billion (DKK 14 billion) across 8 assets in Northern and Western Europe within energy generating infrastructure assets. All investments are managed by AIP
InvestmentManagerInvestment typeAsset typeCurrencyCommitmentYear
Anholt Offshore Wind FarmØrstedEquityOffshore windDKK2,500,000,0002011
Butendiek Offshore Wind Parkwpd/SiemensEquityOffshore windEUR100,000,0002013
GeminiNorthland Power Inc./SiemensSubordinated loanOffshore windEUR120,000,0002014
Gode Wind 2ØrstedEquityOffshore windEUR288,000,0002014
Burbo Bank ExtensionØrstedEquityOffshore windGBP330,000,0002016
Tees Renewable Energy PlantMGT Teesside EquityBiomass-fired plantGBP150,000,0002016
Walney Offshore Wind FarmØrsted EquityOffshore wind GBP340,000,0002017
Nyhamna gas processing plantNorth Sea infrastructure ASEquityGas infrastructureNOKUndisclosed2018