08:16 AM EST, 01/22/2025 (MT Newswires) -- Canadian private equity firm Novacap Investments Inc. has closed a US$1 billion fund to invest in digital infrastructure assets after a two-year process of raising the money, Bloomberg is reporting Wednesday.

The report noted the new fund is targeting about 10 regional companies that sell connectivity and data access services, backed by physical assets, with a strategy to invest as much as $100 million in each.

It also noted the Brossard, Quebec-based firm, which manages about C$11 billion ($7.7 billion), began courting investors for the digital fund at a time when rising interest rates and a slow market for acquisitions made it difficult for some private equity shops to raise fresh capital.

"Yes, it was long," Chief Executive Officer Pascal Tremblay said of the fundraising process. "It was difficult in some instances, but it was very successful," exceeding the firm's original target of $750 million.

According to the report, Novacap has already deployed some of the money into four US businesses, including H5 Data Centers LLC and All West Communications Inc., a home internet provider with customers in Utah and Wyoming.

Institutional firms, family offices and high-net worth individuals from North America, Europe, the Middle East and Asia are among the fund's partners, Novacap officials said, declining to give specific names.

Digital infrastructure will continue be in high demand because of the rapid growth in artificial intelligence, Novacap's Ted Mocarski said. "We were all talking about the cloud 10 years ago," he said. "Now we're talking about AI, and these new technology developments always drive the need for more power, more storage and faster connectivity."

Novacap, founded in 1981, is perhaps best known for its investments in technology companies, but the firm also invests in financial services and other sectors, with stakes in consumer business such as women's clothing designer Joseph Ribkoff and mattress manufacturer Kingsdown.

One of its big winners has been payment processor Nuvei, the target of a successful $6.3 billion privatization by Advent International. Novacap stayed in as an 18% stake shareholder in Nuvei.

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