A resilient asset class in uncertain times
Infrastructure assets, characterised by long-term contracts and essential services, offer predictable cash flows and defensive characteristics, making them appealing during uncertain times. Meridiam, a Paris-based independent investment Benefit Corporation founded in 2005 by Thierry Déau, focuses exclusively on sustainable infrastructure development over long-term horizons. The firm manages over $22 billion in assets and has completed more than 125 projects worldwide, solidifying its position as a leading infrastructure investor across Europe, North America, and Africa.
In April 2023, Meridiam announced a significant capital increase, with Samsung Life Insurance acquiring a 20% stake in the company. This strategic partnership aims to accelerate Meridiam's pipeline of sustainable infrastructure projects and enhance its operational capacity. The capital injection aligns with Meridiam’s strategy to address global infrastructure deficits, particularly in energy transition and urban mobility.
Innovations in infrastructure liquidity
Traditionally, infrastructure has been perceived as an illiquid asset class requiring significant time horizons. Meridiam has challenged this perception by pioneering innovative financial structuring, turning infrastructure into a more liquid and dynamic investment vehicle. By creating investment vehicles that allow institutional investors to access infrastructure assets more efficiently, Meridiam has broadened the appeal of infrastructure investment beyond the largest pension and sovereign wealth funds.
Meridiam’s performance is reflected in consistent returns, robust risk management, and measurable impact outcomes. The firm’s long-term approach, combined with rigorous due diligence and local engagement, ensures that its projects are financially sound and socially beneficial.
In March 2024, Meridiam began construction on a $230 million high-speed fibre-optic network project in Alabama's Black Belt region. The network will provide fibre broadband access to 53,000 households and businesses, demonstrating Meridiam's commitment to bridging the digital divide and contributing to economic development.
While specific internal rates of return (IRR) are not publicly disclosed across all its funds, industry observers note that infrastructure-focused investment funds are growing, with lower volatility compared to traditional buyouts or venture capital. Indeed, Infrastructure assets under management reached an all-time high of $1.3 trillion as of June 2024. Meridiam’s disciplined asset selection and long-term partnerships with governments and municipalities contribute to this stable growth.
An ESG-driven investment philosophy
Meridiam’s commitment to environmental, social, and governance (ESG) principles is integral to its investment strategy. As a certified B Corporation, Meridiam incorporates ESG criteria into every stage of the investment lifecycle—from project origination to management and eventual exit. This focus aligns financial performance with long-term sustainability goals. Its involvement in the ESG Book next-gen ESG data project pays testament to this.
CEO Thierry Déau stated: “We believe it will substantially increase the quality and availability of ESG information to direct financing flows in accordance with sustainable development goals and the Paris Agreement. As impact investors since inception, Meridiam has been confronted with the lack of data transparency and has developed strong expertise in impact measurement. Through this investment by the Green Impact Growth Fund, we will further contribute to the field by helping ESG Book become the reference player in the sustainability data field.”
Indeed, the firm actively measures the impact of its projects on CO₂ emissions, local employment, and access to essential services, publishing annual reports that highlight these achievements. This transparency strengthens its relationships with limited partners and reinforces its reputation as a responsible, high-performing asset manager.
Navigating risks and opportunities
The infrastructure sector faces challenges such as rising interest rates, supply chain constraints, and evolving regulatory frameworks. However, Meridiam’s strategic agility and global footprint allow it to adapt quickly, often turning constraints into opportunities.
For instance, Meridiam has increased its focus on digital infrastructure and climate adaptation projects—areas where demand is growing, and capital deployment can be both swift and impactful. Its diversified geographic exposure, from Europe to Sub-Saharan Africa, provides additional buffers against regional market fluctuations.
Moreover, Meridiam's collaboration with development finance institutions and multilateral organisations strengthens its ability to operate in emerging markets where infrastructure needs are greatest, but risks are higher. These partnerships not only de-risk projects but also enhance the development impact of its investments.
A blueprint for the future of Infrastructure investment
As investment evolves in the face of macroeconomic uncertainty, Meridiam offers a compelling blueprint for the future: long-term commitment, ESG integration, innovative structuring, and a strong performance record. In doing so, it not only redefines what infrastructure investment can achieve but also expands its role in addressing global challenges.
The firm’s journey underscores a critical point for investors and policymakers alike: infrastructure, far from being a passive or static asset class, is a dynamic engine of sustainable growth. In firms like Meridiam, the investment industry has a clear example of how resilience and innovation can go hand in hand.
Infrastructure assets, characterised by long-term contracts and essential services, offer predictable cash flows and defensive characteristics, making them appealing during uncertain times. Meridiam, a Paris-based independent investment Benefit Corporation founded in 2005 by Thierry Déau, focuses exclusively on sustainable infrastructure development over long-term horizons. The firm manages over $22 billion in assets and has completed more than 125 projects worldwide, solidifying its position as a leading infrastructure investor across Europe, North America, and Africa.
In April 2023, Meridiam announced a significant capital increase, with Samsung Life Insurance acquiring a 20% stake in the company. This strategic partnership aims to accelerate Meridiam's pipeline of sustainable infrastructure projects and enhance its operational capacity. The capital injection aligns with Meridiam’s strategy to address global infrastructure deficits, particularly in energy transition and urban mobility.
Innovations in infrastructure liquidity
Traditionally, infrastructure has been perceived as an illiquid asset class requiring significant time horizons. Meridiam has challenged this perception by pioneering innovative financial structuring, turning infrastructure into a more liquid and dynamic investment vehicle. By creating investment vehicles that allow institutional investors to access infrastructure assets more efficiently, Meridiam has broadened the appeal of infrastructure investment beyond the largest pension and sovereign wealth funds.
Meridiam’s performance is reflected in consistent returns, robust risk management, and measurable impact outcomes. The firm’s long-term approach, combined with rigorous due diligence and local engagement, ensures that its projects are financially sound and socially beneficial.
In March 2024, Meridiam began construction on a $230 million high-speed fibre-optic network project in Alabama's Black Belt region. The network will provide fibre broadband access to 53,000 households and businesses, demonstrating Meridiam's commitment to bridging the digital divide and contributing to economic development.
While specific internal rates of return (IRR) are not publicly disclosed across all its funds, industry observers note that infrastructure-focused investment funds are growing, with lower volatility compared to traditional buyouts or venture capital. Indeed, Infrastructure assets under management reached an all-time high of $1.3 trillion as of June 2024. Meridiam’s disciplined asset selection and long-term partnerships with governments and municipalities contribute to this stable growth.
An ESG-driven investment philosophy
Meridiam’s commitment to environmental, social, and governance (ESG) principles is integral to its investment strategy. As a certified B Corporation, Meridiam incorporates ESG criteria into every stage of the investment lifecycle—from project origination to management and eventual exit. This focus aligns financial performance with long-term sustainability goals. Its involvement in the ESG Book next-gen ESG data project pays testament to this.
CEO Thierry Déau stated: “We believe it will substantially increase the quality and availability of ESG information to direct financing flows in accordance with sustainable development goals and the Paris Agreement. As impact investors since inception, Meridiam has been confronted with the lack of data transparency and has developed strong expertise in impact measurement. Through this investment by the Green Impact Growth Fund, we will further contribute to the field by helping ESG Book become the reference player in the sustainability data field.”
Indeed, the firm actively measures the impact of its projects on CO₂ emissions, local employment, and access to essential services, publishing annual reports that highlight these achievements. This transparency strengthens its relationships with limited partners and reinforces its reputation as a responsible, high-performing asset manager.
Navigating risks and opportunities
The infrastructure sector faces challenges such as rising interest rates, supply chain constraints, and evolving regulatory frameworks. However, Meridiam’s strategic agility and global footprint allow it to adapt quickly, often turning constraints into opportunities.
For instance, Meridiam has increased its focus on digital infrastructure and climate adaptation projects—areas where demand is growing, and capital deployment can be both swift and impactful. Its diversified geographic exposure, from Europe to Sub-Saharan Africa, provides additional buffers against regional market fluctuations.
Moreover, Meridiam's collaboration with development finance institutions and multilateral organisations strengthens its ability to operate in emerging markets where infrastructure needs are greatest, but risks are higher. These partnerships not only de-risk projects but also enhance the development impact of its investments.
A blueprint for the future of Infrastructure investment
As investment evolves in the face of macroeconomic uncertainty, Meridiam offers a compelling blueprint for the future: long-term commitment, ESG integration, innovative structuring, and a strong performance record. In doing so, it not only redefines what infrastructure investment can achieve but also expands its role in addressing global challenges.
The firm’s journey underscores a critical point for investors and policymakers alike: infrastructure, far from being a passive or static asset class, is a dynamic engine of sustainable growth. In firms like Meridiam, the investment industry has a clear example of how resilience and innovation can go hand in hand.
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