Challenger Financial Services Group has entered into a joint venture with Mitsui & Co.Ltd to establish a Singaporean-based investment management business focusing on emerging market infrastructure.

The joint venture’s first initiative will be the Challenger Mitsui emerging markets infrastructure fund, with a target size of $US1.2 billion ($A1.25 billion).

It will be a closed-end wholesale fund investing in infrastructure assets in emerging market economies, Challenger said in a statement today.

Chief executive officer Mike Tilley said Challenger’s new partner was a seasoned asset owner and manager of emerging market infrastructure assets with an origination network spanning 170 offices across 69 countries.

Mr Tilley said Challenger already had been building expertise in infrastructure for some time both as an originator and investor.

“This joint venture represents another move forward in the development of Challenger’s infrastructure capability,” he said in the statement.

“Securing such a high calibre partner is a great outcome for Challenger and complements our existing international strategic relationships.”

The fund, which will be jointly managed by Challenger and Mitsui & Co, already has committed capital of $US175 million ($A182.86 million), sourced from both the sponsors and institutional investors, Mizuho Corporate Bank and Access Capital Advisors.

AAP