Morgan Stanley raises billions for infrastructure

By Aarthi Sivaraman and Mathieu Robbins

NEW YORK/LONDON (Reuters) - Morgan Stanley (MS.N: Quote, Profile, Research) and a fund set up by General Electric (GE.N: Quote, Profile, Research) and Credit Suisse (CSGN.VX: Quote, Profile, Research) said on Monday they had collectively raised almost $10 billion for funds to invest in infrastructure.

Morgan Stanley said it has raised a $4 billion infrastructure fund, exceeding its target, and is targeting assets in sectors like transportation, energy and utilities.

Separately, Global Infrastructure Partners (GIP), set up by General Electric Co and Credit Suisse Group, also said on Monday it closed a $5.6 billion infrastructure fund which it plans to invest in such opportunities worldwide.

Despite offering lower growth than traditional private equity deals, infrastructure assets such as utilities, toll roads and airports are attractive to financial bidders like banks and pension funds because of their stable cashflow.

Financial institutions including banks ranging from Australia's Macquarie (MQG.AX: Quote, Profile, Research) to Goldman Sachs (GS.N: Quote, Profile, Research) and buyout firms like UK-based 3i Group (III.L: Quote, Profile, Research) have all set up infrastructure funds or units as they try to complement other activities with such stable investments.

Such investments are viewed as so stable that pension funds such as Ontario Teachers' Pension Plan have also invested directly in assets such as UK water companies and power producers.

At $4 billion, the Morgan Stanley fund shot past its original target of $2.5 billion, raising capital in North America, Europe, Australia, the Middle East and Asia, Morgan Stanley said in a statement.

Investors in the Morgan Stanley fund ranged from big pension funds and insurance companies to some of the New York-based bank's employees.  Continued...