Exclusive: RDIF, CDC eye first deal before summer

Infrastructure Investor, 24.01.2016

"The Franco-Russian pair will close the first transaction from its €1bn tie-up in the consumer sector, with areas including construction and infrastructure next on the list.

The Russian Direct Investment Fund (RDIF), the Moscow-based sovereign vehicle, expects to seal its first joint deal alongside France’s Caisse des Depots International (CDC International) before the summer.

A spokesperson for the institution confirmed that the debut transaction would target a company operating in the consumer goods sector, in line with an investment strategy that spans private equity, agriculture and infrastructure.

RDIForiginally announced its partnership with CDC International in early 2013, launching the Russia-France Investment Fund in November of that year. The vehicle then had a loosely defined mandate, seeking investments in equity and debt securities, infrastructure and real estate in Russia and France.

The tie-up now plans to deploy more than $1 billion across 10 projects in sectors including consumer goods, machinery, food and agriculture, construction materials, tourism, retail and infrastructure.

The news comes weeks after RDIF launched a partnership with Dubai's DP World, through which the Emirati operator aims to deploy $2 billion in upgrading Russian ports. RDIF, which has already launched a number of these partnerships, was set up in 2011 with an initial capital pool of $10 billion to invest equity alongside strategic and financial investors from overseas.

The fund claims to have attracted more than $25 billion of foreign capital into the Russian economy through these long-term "strategic" tie-ups. Institutions that have partnered with the vehicle include China Investment Corporation, the Korea Investment Corporation, two Saudi sovereign funds, the Abu Dhabi Investment Authority, the Fondo Strategico Italiano and India’s Tata Power.

Last November, Infrastructure Investor reported that RDIF was planning a bid for Moscow’s RUB300 billion (€3.5 billion; $3.8 billion) Central Ring Road project alongside the Kuwait Investment Authority (KIA). The transaction was to be funded through a $1 billion co-investment pool that sees KIA automatically invest in every asset backed by the Russian fund.