Stonebridge Financial Corporation (“Stonebridge”) is very pleased to announce the launch of Stonebridge Infrastructure Debt Fund II L.P. (“Fund II”), a limited partnership to be formed under the laws of the Province of Ontario. Investors will be limited partners of the Partnership.
Stonebridge currently manages Stonebridge Infrastructure Debt Fund I L.P. (“Fund I”), a closed-end infrastructure debt fund developed with the support of PPP Canada Inc. Fund I’s investment objective is to provide private debt financing for the construction and operation of social infrastructure and energy assets. Fund I closed in 2012 with capital commitments totalling $201,468,750. Investors include the Business Development Bank of Canada, Teamsters Canadian Pension Plan and six other Canadian pension funds.
Similar to Fund I, Fund II will invest in fixed rate, senior construction and/or take-out debt financings on a private placement basis, with a minimum external or internal credit of BBB, incurred and applied for the purpose of the construction, operation, ownership or maintenance of infrastructure assets that are, generally, (i) essential in nature to local communities or regional or national populations, and (ii) are expected to generate relatively stable and predictable cash flows over the long term which assets include, but are not limited to:
(a) Social infrastructure: which includes, among other things, hospitals, long-term care facilities, schools, universities, correctional facilities, courthouses, subsidized housing, community centres, recreational facilities, roads, bridges, airports, mass transit and water and waste management systems, and;
(b) Energy infrastructure: which includes, among other things, public or private producers of non-merchant based energy, pipelines, transmission and distribution lines.
The size of Fund II is expected to be in excess of $300,000,000 with an initial closing scheduled for December 2013. A subsequent closing will occur within 12 months of the initial closing to accommodate additional interested investors.
Stonebridge is excited to be launching Fund II, an investment fund offering unlike any other in Canada, providing high quality investment cash flow and returns ideally suited for long-term, liability-driven investors. Given the current volatility in the equity markets and interest rates that remain at historical lows, Stonebridge believes that private infrastructure debt is an ideal asset class providing institutional investors with incremental yield, portfolio diversification, credit enhancement and liability matching characteristics not otherwise available in the public fixed income market.
Stonebridge is an independent financial services company with proven expertise in arranging and structuring debt financings for syndication in the Canadian institutional marketplace, with a focus on the energy and social infrastructure sectors. Stonebridge was founded in 1998 with the support of three major Canadian life insurance companies, with a view to establishing a reliable origination vehicle for high quality private debt investment opportunities and portfolio administrative services. Today, those institutions remain as minority preferred shareholders of Stonebridge and continue to be key loan syndication relationships.