CPPIB pledges $600 mn in NIIF’s master fund

Industry:    December, 2019

Canada’s largest pension fund manager Canada Pension Plan Investment Board (CPPIB) has committed to invest up to $600 million in National Investment and Infrastructure Fund (NIIF).

The investment would be made through a $150 million commitment in the master fund of NIIF and co-investment rights of up to $450 million in future opportunities to invest alongside the master fund.

Post the funding, CPPIB will become a shareholder in NIIF’s investment management company.

“With this fourth close of the NIIF Master Fund, we are pleased that the fund has achieved its initial target size of $2.1 billion with domestic and international investors of the highest reputation and quality. We thank all our investors, and the Government of India, particularly the Ministry of Finance and the Ministry of External Affairs, for their strong support,” said Sujoy Bose, managing director and chief executive officer of NIIF.

The fund also has co-investment rights of $3 billion from global and domestic investors, which will allow NIIF write larger cheques for single infrastructure deals.

To be sure, NIIF Master Fund invests equity capital in core infrastructure sectors in India, with a focus on transportation, energy and urban infrastructure.

In August, the fund received commitments of about $2 billion from AustralianSuper, Australia’s largest superannuation and pension fund, and Ontario Teachers’ Pension Plan (Ontario Teachers’), one of Canada’s largest single-profession pension plans. It also counts Abu Dhabi Investment Authority (ADIA), Temasek, Axis Bank, HDFC Group, ICICI Bank and Kotak Mahindra Life Insurance, in addition to the Indian government as its shareholders.

NIIF was set up in 2015 along the lines of a sovereign wealth fund with 49% equity held by the Union government and the rest by foreign and domestic investors.