(Infra PE) Brookfield vs EQT/Stonepeak/ISQ/ECP
Hi all,
Does anyone know how infra PE like ISQ/Stonepeak/ECP compare to Brookfield in terms of 1) salary, 2) reputation, and 3) growth potential?
I know all of these players are top-notch in the infra space, but considering that Brookfield is a Canadian company as opposed to other firms that are US-based, I was wondering if there would be pay/reputation difference. I am pretty sure that former would be a great opportunity since it has the largest AUM in the aforementioned names, but I am curious if there would be other factors that I should be aware of.
If anyone can shed some light, I would greatly appreciate your inputs!
These are all very different firms with different focuses and strategies, all of which are well regarded in the space. Do you have offers from these shops? I'd be surprised if you were recruiting for all of them given they are all fairly different.
ECP is a predominately energy private equity firm transitioning to a clean energy platform. Stonepeak is a value infra investor that's largely sector agnostic within infra. I would compare them to GIP in many ways. Brookfield is focused predominately on core infra and renewables, although their mandate is broad. Most of, if not their entire, infra equity team covering North America is based in Toronto. EQT is largely focused on digital infrastructure, although they recently closed their first renewables investment when the bought Cypress Creek. I'm not as familiar with the other firm you mentioned.
What sector(s) are you interested in?
Thank you for the the reply. Unfortunately, I don't have an offer at any of those names haha.
But I wanted to preprare for the future!
Does Brookfield really not have any infra people in New York?
Does Brookfield really not have any infra people in New York?
Does Brookfield really not have any infra people in New York?
Echoing sentiments above. @RE_Student1995 knows what's up. Pretty much paraphrasing him here but:
ECP - More LS Power-like, many "infra-like" investments, will invest across the clean energy spectrum across electrification, renewables, carbon capture, RNG etc. A little more tech-integrated vs the other names, could do/look at stuff like a solar back-of-the-meter DevCo like SunRun whereas others would find it hard fitting that into their strategy. Would regard their comp in the UMM bucket in terms of comparability
Stonepeak - Hard infra assets, similar to GIP - invests across infra spectrum across core, core+, telecom, water, renewables. Along with GIP are some of the largest infra investors in the space, and thus comp mid/high-range MFs via your Apollo/BX etc re: big hours, big pay
MIRA - Very formidable, although GIP has the biggest one-size fund, MIRA has the most AUM across all their funds combined. Have dedicated sector teams for energy and waste in the US, their waste team is #1 in the US. Pay for MIRA however isn't nearly as strong as it is for GIP/Stonepeak though so more bark than bite when it comes to AUM reputation vs comp (but your learning experience will be superb) - resembles MM / bottom quartile UMM bucket
EQT - traditional MF name in the breadth of CVC and such and infra team is strong but noted that infra is 1 of many strategies vs something dedicated like GIP. Infra team just bought CCR which is a 1.6 GW op solar platform with big dev tail (one of the biggest solar developers in the US which was previously owned by HPS & Temasek/GIC) but rumors are that they paid a lot for it so will be interesting to see how that comes along as their solar projects are very NC/SC-focused. Comps in the lower end of MF / top quartile UMM
ISQ - Based in Miami so good for taxes, presence in renewables lackluster but has one of the strongest emerging markets teams for Infra, probably comparable to Brookfield as another big LatAM investor. Shelf life the shortest out of all the names here in terms of longevity so a bit of TBD but earmarked $12bn for their latest fund which is no small number indeed
Brookfield - Strong in all areas, very strong capital markets team along with a lot of emerging markets / ESG focus. All things infra is based out of Toronto whereas other Brookfield strategies like Distressed are based out of NY. Pay is underwhelming - the lowest on the list of names here - and also hit double whammy because of CAD vs USD nominal FX.
Like you said all players are top-notch. Cannot go wrong with any name. AUM is a good signal of success in infra as you mentioned. Would expect to grind pretty hard at every single one - have friends at all these funds with exception of ISQ so perhaps they chill a bit more there since it's Miami? Not sure - infra hours have gone up a lot over the last few years and there is a massive amount of DD to do in regards to very nuanced / tight modelling + R&W + site visits + environmental DD. Also just a lot of auction fatigue in the last 18-24mo in general
Big chunky pockets of capital so need to invest in platforms and/or substantial JVs with reputable PublicCos/HoldCos/DevCos. Consider a $10bn fund - ~10 investments mean $1bn equity each. Min. 20-30% equity of capital stack nowadays means you're looking at deals that range $2-5bn TEV in size or at least that sum deployed over a period of time (so smaller initial investment with add-ons afterward) - you are not going to hit that level of capital deployment via investing in assets / portfolios on the energy-side of things at least. Only exception on this list is Brookfield as they have multiple funds that they can park capital so can be opportunistic in looking at things that need are circa $250mm-$750mm as an equity check
Everyone here is standard control equity investor - don't play too much up and down capital structure most of the time
That is very informative. Thank you so much for the in-depth analysis!!
Appreciate this insight - mind PMing me?
Sure.
Do these infra funds interact at all with Public Finance coverage/sector groups within IBD? I’m thinking of Goldman’s Public Sector & Infrastructure (PSI) group since infrastructure is part of the name.
I’ve heard tangentially they basically do financings for munis and non-profits etc. not sure where the infrastructure advisory or investing comes in. Maybe it’s all covered by industry groups (TMT for digital infra, NR for energy assets etc.), I don’t know - but I’m sure you would!
Public finance depends whether the nature of the asset is PPP-related. Energy in the US is typically private however (with government subsidies from DOE etc or tax credits via renewables if anything), so not on the same level that a railroad or toll bridge might have in terms of interconnection.
Yes, PF&I will help advise on muni bonds if that is deemed a desired source of financing.
Generic infra advisory is generally covered by P&U and NR groups within IBD for M&A, strategic planning and fairness opinion reasons.
You will also have project finance that will help advise pre-COD of an asset to help arrange a revolver, bridge or permanent financing
Public private partnership investors such as John Laing, Meridiam, Axium, Fengate, etc may work with this public finance groups. However, the PPP space is pretty niche, and there are only a handful of private equity firms that play in the space.
It's an attractive sector with very low risk, high single digit returns. KKR announced the acquisition of John Laing to get exposure to this very capital intensive, highly contracted sector.
Bump
Stay far far away from Morgan Stanley Infra... Something real bad is going on
can you elaborate?
Can't say too much because some legal stuff, but there are some issues with very senior management and less than kosher practices with their books / valuation...
You can’t just post something like this and not give some details
Lol, thought I would let the suspense build for a while. Just posted some stuff above
MS Project Finance or MSIP?
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