Largest Participants Dominate Natural Resources Market

Preqin’s inaugural Natural Resources Top 100 report finds that capital concentration in the industry is benefiting a small group of fund managers. The top 100 largest fund managers account for four out of five dollars raised in the last 10 years, while the top 25 alone have secured more than a quarter of a trillion dollars from investors.

At the same time, the top 100 largest institutions investing in the asset class have allocations totalling $115bn. This scale of commitments means they are able to make large investments in natural resources funds, as well as negotiate more favourable terms and gain access to direct and co-investment opportunities.

 

Key Facts on the 100 Largest Natural Resources Fund Managers:

  •   Capital concentration is becoming increasingly pronounced among natural resources funds. In the first half of

    2017, the five largest funds closed accounted for 72% of total capital raised across the industry.

  •   The top 100 largest natural resources fund managers have raised a total of $451bn in the last 10 years, and have closed 308 vehicles. This represents 79% of total fundraising during that period, and 32% of the number of funds closed.
  •   Sixty-six of the 100 top fund managers are based in North America, and these firms have raised $343bn in the past 10 years. Eight firms are based outside North America, Europe and Asia, and these fund managers have raised $14bn through 19 vehicles.
  •   EnCap Investments is the largest natural resources fund manager, having raised $27.6bn in the last 10 years. Global Infrastructure Partners holds the highest level of dry powder, at $12.6bn. In total, the top 100 natural resources fund managers have $143bn available to be deployed.

    Key Facts on the 100 Largest Natural Resources Investors:

  •   The top 100 institutional investors in natural resources** have $115bn committed to the asset class. Of

    that, North America-based investors account for $92bn.

  •   Almost all (94%) of the top 100 investors target energy funds. Significant proportions also seek investments in timberland (52%), agriculture (50%) and mining funds (46%).
  •   The top 100 investors have a mean allocation to natural resources of 7.4% of their assets, compared to an average of 4.4% of AUM for all natural resources investors.
  •   Despite the US accounting for the largest number of top 100 members, the two largest investors in natural resources are Canada-based Manulife Financial and the Department for International Development in the UK. These institutions allocate $7.2bn and $5.2bn respectively to the asset class.

     

    For more information and analysis, see the full Natural Resources Top 100 report by clicking here.  

    *The top 100 fund managers are ranked by total capital raised for commingled natural resources vehicles in the past 10 years.

    **The top 100 investors are ranked by their current dollar allocation to natural resources.