Macquarie says the fund seeks investments that "provide essential services to the community, have a strategic competitive advantage and offer sustainable and predictable cash flows." It aims to deliver sustainable cash yields and moderate capital growth from a diversified portfolio.
According to the bank, MEIF is the first of its kind in Europe, allowing investors access to infrastructure investments through a fund which also actively manages the investments on their behalf. MEIF has made eight acquisitions since its launch in 2004. Of these, six are major infrastructure assets, such as a 50.1% interest in UK utility South East Water and a 10% stake in Brussels International Airport.
Two of the fund's more recent investments have been in renewables. In March it bought Energy Power Resources Ltd (EPR), which owns and manages the UK's largest portfolio of biomass plant with a total capacity of 122 MW. EPR also holds a 50% stake in Yorkshire Wind, which owns the Ovenden Moor and Royd Moor wind farms with a total capacity of 15.7 MW. The other 50% is held by leading UK energy-supplier PowerGen.
Six wind plant
MEIF's purchase of EPR was followed in June by the acquisition of the portfolio of six wind power plant -- three in France and three in Sweden -- from Eurowind International, a group of private investors. In France, the 9 MW Téterchen station is already up and running , while the 11.5 MW Bois de l'Arche and 9.2 MW Bois Bigot projects are due for completion in mid 2006. In Sweden, the already functioning SjolundaWind Park, Hurva Vind and World Wind Sweden plant represent a total installed capacity of 7.6 MW. All six are managed by Macquarie's UK-based renewables operation, EPR.
These acquisitions, says Macquarie, fit well with MEIF's investment criteria. The bank considers the European renewables sector offers "an attractive risk/return profile, a secure revenue stream with predictable cash flow, often supported by long term power purchase agreements and legislated government support." The bank says it will continue to look at "potential quality investment in renewables."
In addition to its MEIF investments, Macquarie also owns 50% of Novera Macquarie Renewable Energy (NMRE), a joint venture with Australia's Novera Energy Ltd, also established in 2004. NMRE owns a portfolio of 137 MW of renewable energy assets in the UK and Germany, including landfill gas, hydro and wind power.
Of this, wind contributes 23.5 MW: 9 MW already turning at Prützke and Rohlsdorf in northeast Germany, and 14.5 MW in the final stages of construction at Mynydd Clogau in Wales. NMRE has an option on a further 56 MW of wind assets in Germany and, through another joint venture with UK developer RED Group, has a 50% share in 88 MW of wind power at an advanced stage of development in northeast England and Scotland.