Global private equity group KKR & Co is expanding its presence in Asia’s infrastructure sector with new hires and is looking at launching a new fund as project spending in the region picks up.
The firm has poached David Luboff, CEO of Macquarie Group’s Asia Infrastructure Fund, as its new head of Asia Pacific Infrastructure, people familiar with the matter told Reuters.
Luboff, based in Singapore, will lead the Asian operations of the firm’s infrastructure business from early next year, the people said. Reuters could not reach Luboff for comment.
A KKR spokeswoman confirmed the hire to Reuters but did not provide additional details.
KKR has also hired Hardik Shah, formerly with Brookfield Asset management, as a Mumbai-based director, the spokeswoman said. He will focus on exploring infrastructure investment opportunities.
People familiar with the matter said KKR is also considering launching an Asian-focused regional fund, following strong demand from investors keen to increase exposure to Asian and emerging markets.
One of the sources said the fund could be as large as $1.5 billion and would look at areas such as power-related investments, toll roads and telecom infrastructure.
KKR declined to comment on the fundraising. The people could not be named as the information is confidential.
“Asia is an attractive part of KKR’s global infrastructure investment strategy. Across the region, macroeconomic and societal trends are fostering a unique need for expertise and private capital solutions for projects in a wide range of infrastructure sub-sectors,” Raj Agrawal, global head of KKR’s infrastructure business, told Reuters last week. He declined to comment about a new Asia-focused fund.
The new hires follow the close of KKR’s $7.4 billion global infrastructure fund in September, which focuses primarily on North America and Europe.
Asia is still a relatively small market for infrastructure funds, accounting for only about 15 percent of the total global fundraising pool over the past ten years, according to Preqin data. Only four Asia-focused infrastructure funds worth a combined $4.1 billion have been raised this year, just 5 percent of global activity.
Infrastructure deals in the region, however, picked up from 2015 to 2017, and accounted for more than a quarter of the global amount last year, Preqin data showed, as local economies spent trillions of dollars to improve creaking infrastructure.
KKR is a relative latecomer to infrastructure in the region compared with peers Global Infrastructure Partners, I Squared Capital and the infrastructure investment arms of Macquarie Group, Brookfield Asset Management and JPMorgan.
Established in 2008, KKR’s infrastructure business manages approximately $13 billion in assets under management.