ASX-listed Macquarie Group Ltd (AU:MQG) has successfully raised over €8 billion for the Macquarie European Infrastructure Fund 7 (MEIF 7), its European infrastructure investment vehicle. The deal reflects the prevalent interest in the infrastructure sector despite record-high interest rates and an uncertain macroeconomic scenario. Macquarie’s MEIF 7 marks the largest fundraising to date for the asset manager and boasts of being the sector’s largest Europe-focused infrastructure fund.
Australia’s Macquarie is a global financial services group offering various services, including asset management, banking, and financial and investment advisory. The group operates in 34 markets and currently has AU$892 billion of assets under management (AUM).
Details About MEIF 7
Macquarie’s unit, Macquarie Asset Management (MAM), focuses on themes including decarbonization, digitization, the circular economy (promotes sustainable use of natural resources), and demographic change. MEIF 7 has already made three investments, including a small stake in British data center firm Virtus, a minority stake in Austrian electric vehicle charging provider Best in Parking, and a 50% stake in utility network operator Last Mile Infrastructure.
A tough macro environment has prompted investors to shift their money into safer areas such as bonds. Even so, Macquarie noted that a revolution of greener and cleaner energy resources has piqued investor interest in infrastructure funds.
Adam Lygoe, MAM’s head of institutional and international wealth distribution, told the Financial Times that the “infrastructure gap of what’s planned versus what’s needed is reasonably wide,” which is driving interest in the sector. Governments worldwide have allocated only limited resources toward these projects, leaving a big scope for private players to pitch in.
Importantly, talking about MEIF 7’s successful fundraising, Lygoe said that investors are keen to invest in projects closer to home. Most of the investments came from Europe, the Middle East, and Africa, followed by Asia Pacific and the Americas. MAM also noted that about 92% of clients were repeat investors who had already invested in MAM’s previous funds, with 24 new investors being added. Investors mainly include pension funds, insurance companies, sovereign wealth funds, and family offices.
Is MQG a Buy or Sell?
Recently, Goldman Sachs analyst Andrew Lyons reiterated a Hold rating on MQG stock with a price target of AU$180.80, implying 1.8% downside potential.
Overall, analysts remain split on Macquarie’s stock trajectory. On TipRanks, MQG stock has a Moderate Buy consensus rating based on three Buys versus four Hold ratings. The Macquarie Group Ltd share price forecast of AU$185.64 implies that shares are almost fully valued at current levels.
