EQT AB has raised €21.5 billion ($23.2 billion) for its latest infrastructure fund — a sum a top executive for the Swedish investment firm says underscores how the energy sector’s funding needs trump an uncertain market for deals.
“The capital need for the next 20 to 25 years to transform energy and digital systems is so large, and there are only about five competitors that are as substantial and large as us, so we don’t see any roadblocks to dealmaking,” Lennart Blecher, head of real assets at EQT, said in an interview.
“Energy transition is the strongest commercial trend since the beginning of industrialization,” he said. There is an estimated $275 trillion capital need over the next 25 years, he said.
EQT Infrastructure VI, which had targeted €20 billion, met its hard cap, according to a statement Friday. It includes €21.3 billion in fee-generating assets under management. The vehicle is about 35% larger than its predecessor, which closed at €15.7 billion in 2021.
Bullish dealmaking predictions have been rare with global activity slowing in the wake of sweeping policy changes in the US. Infrastructure should buck the tend, according to Blecher.
“Most of the infrastructure services we provide are to domestic populations, so we don’t currently expect to see a large impact from tariffs,” Blecher said in the interview. “People need energy and connectivity in good and bad times.”
While fundraising for infrastructure strategies has been relatively easier than raising money for buyouts, challenges are emerging as contributions from institutional investors are flatlining after years of large commitments.
EQT, which has €75 billion of global infrastructure assets under management, has been raising money for its latest fund since 2022 and has already closed 10 investments.
That includes the purchase of Constellation Cold Logistics from Arcus Infra Partners in 2024, the $1.5 billion take-private of Swedish wind park developer OX2 AB earlier that year and the acquisition of US solar company Madison Energy Investments in 2022.
The fund will invest in digital infrastructure as well as assets generating, storing, and distributing energy. It will also focus on investments tied to the decarbonization and electrification of industrial processes and social infrastructure, among other areas, the firm said.
About 70% of EQT’s existing clients participated in the fundraising, boosting their contributions by an average 20%, according to Blecher. Asia Pacific and the Americas each accounted for 30% of commitments, with the rest coming from Europe, the Middle East and Africa, he said.
“I think today, about 25% of everyone’s portfolio should be in infrastructure — it provides downside protection, is an inflationary hedge and if you pursue industrial transformation in a hands-on manner like we do, we can also generate attractive returns.”
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