Macquarie Bank’s successful endeavours in the Asian infrastructure market are inspiring others to follow in its footsteps.
In particular, Babcock & Brown is currently setting up a presence in Hong Kong. Deutsche Bank and Morgan Stanley are also said to be building up infrastructure fund teams, sources say.
“Major houses are starting to realise the benefits of making a long term investment in infrastructure funds,” says CK Wan, a director covering investment banking and private equity for Asia at Akamai Financial Markets in Hong Kong. “They’re in it for the long haul.”
Some funds are being raised externally while others firms are choosing to allocate finances from their own balance sheet. The funds are mainly focussing on South East Asia, India and China.
“Banks are looking for people with strong government connections, people who know where and when the next toll road is going to be built,” says CK Wan. “The pool of talent is very thin.”
As a result, wages vary dramatically, with banks prepared to pay whatever it takes in some instances to get the right people.
“It’s all about the deal sourcers,” says a headhunter in Hong Kong who did not want to be named. “A lot of talent is coming from Australia and, of course, firms are looking to poach from Macquarie, which has really pioneered the field.”