BY SABRINA WILLMER

EIF Management LLC plans to start fundraising soon for its next power focused fund, probably aiming for a pool larger than the $1.7 billion it gathered in 2011, according to two people with knowledge of the matter.
The New York-based firm may start marketing its fifth fund by year-end, said one of the people familiar. While a target hasn’t been set, the pool will likely seek at least $1.75 billion, said the people. Alex Stockham, a spokesman at Rubenstein Associates, declined to comment on behalf of EIF.

Energy fundraising reached a peak of $36 billion last year, according to data by London-based researcher Preqin Ltd. Funds focused on the strategy gathered about $17 billion so far this year as of June, the data shows. EIF invests in electric generating and transmission companies, gas pipelines and storage facilities, according to the firm’s website. The firm invests in operating facilities and the development or construction of new facilities. Typically the projects operate underlong-term contracts so they generate steady cash flows.

EIF in June purchased an additional 50 percent stake in Newark Energy Center from Hess Corp. EIF is using a loan to build a 705-megawatt power plant on brownfield industrial land in New Jersey. This year the firm also announced an acquisition of Starfish Pipeline Company LLC and the purchase of the Channelview cogeneration facility, a gasfired power plant in Houston, Texas. In an exit last year, EIF sold an indirect stake in Astoria Energy II power plant, a natural gas-fired facility in Queens, New York. The firm, which was founded in 1987, has raised more than $5 billion in capital. Its funds have made more than 100 investments with a value of close to $20 billion, according to the firm’s website.

The firm’s managing partners include John Buehler Jr., Terence Darby and Herbert Magid, who are in charge of the operations of EIF. Past backers of EIF funds include Teachers’ Retirement System of the State of Illinois, Nebraska Investment Council, Hawaii Employees’ Retirement System and Alaska Retirement Management Board.

This article was taken from the Bloomberg Brief Private Equity Newsletter.
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