Dalmore Capital has been named as the manager of the equity mandate for the Pensions Infrastructure Platform (PIP).
The National Association of Pension Funds (NAPF) has confirmed it is in final discussions with the independent fund manager to run the mandate, but said conversations were still ongoing regarding the appointment of investment managers for the remaining mandates.
Dalmore Capital was formed in 2009 by a team of partners who have been actively investing in the UK infrastructure market since 1998. It currently manages and advises on investment vehicles with aggregate assets under management of over £430m, making it one of the most prominent managers focused on UK infrastructure.
NAPF chief executive Joanne Segars said: “The PIP is working towards a first close with its founding investors. Discussions are ongoing with regard to an investment management role for Dalmore Capital.”
The NAPF said the appointment came following significant interest, and a rigorous selection process, after which asset managers were shortlisted for a number of investment mandates. The search for a manager began in May this year.
At the NAPF Annual Conference in October, Segars said the PIP was looking to appoint a chief executive to oversee the governance and investment decisions of the vehicle.
The PIP will be a not-for-profit, infrastructure fund, by pension funds and for pension funds, aligned to the long-term interests of the UK pension funds who will be its main investors.
Key features of the PIP are:
– Target size of £2bn
– Low leverage
– Low fees, c50bps
– Low risk, the PIP is expected to invest at the low-risk end of the infrastructure asset spectrum, and in projects free of construction risk
– Inflation-linked, fund is seeking long-term cash returns of RPI+2-5% (i.e. as a liability match)
So far nine UK schemes have signed up to the PIP and a tenth unnamed investor committing £1bn between them. They are: the Pension Protection Fund, West Midlands Pension Fund, Strathclyde Pension Fund, BAE Systems Pensions Funds, BT Pension Scheme, Railways Pension Scheme, British Airways Pension Fund, London Pensions Fund Authority, Lloyds TSB Group Pension Schemes.
The National Employment Savings Trust (NEST) has also expressed its interest in the PIP. If NEST did sign up it would become the first UK defined contribution scheme to invest directly in infrastructure.
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