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spk08: Good day and thank you for standing by. Welcome to the Patria first quarter 2022 earnings conference call. Participants are now listen-only mode. After the speaker presentation, there will be a question and answer session. To ask a question during the session, you will need to press star 1 on your telephone. If you require any further assistance, please press star 0. I would like to hand the conference over to your speaker today, Josh Wood, Head of Shareholder Relations. Please go ahead.
spk01: Thank you. Good morning, everyone, and welcome to PATRIA's first quarter 2022 earnings call. Joining today are our Chief Executive Officer, Alex Saig, and our Chief Financial Officer, Marco DiPolito. Earlier this morning, we issued a press release and earnings presentation detailing our results for the first quarter, which you can find posted on our investor relations website at ir.patria.com or on Form 6K filed with the Securities and Exchange Commission. Any forward-looking statements made on this call are uncertain, do not guarantee future performance, and undue reliance should not be placed on them. PATRIA assumes no obligation and does not intend to update any such forward-looking statements. Such statements are based on current management expectations and involve inherent risks, including those discussed in the risk factor section of our latest Form 20F Annual Report filed in April. Also note that no statements on this call constitute an offer to sell or a solicitation of an offer to purchase an interest in any PATRIA fund. As a foreign private issuer, PATRIA reports financial results using International Financial Reporting Standards, or IFRS, as opposed to U.S. GAAP. Additionally, we will report and refer to certain non-GAAP industry measures which should not be considered in isolation from or as a substitute for measures prepared in accordance with IFRS. Reconciliations of these measures to the most comparable measures calculated in accordance with IFRS are included in our earnings presentation. On headline metrics, Patria generated fee-related earnings of $32 million and distributable earnings of $35 million, or 24 cents per share, for 1Q22. We declared a quarterly dividend of 20 cents per share, payable on June 16th to shareholders of record as of June 2nd. With that, I'll now turn the call over to our Chief Executive Officer, Alex Saag. Thank you, Josh.
spk04: Good morning, everyone, and we hope you are all well. Patria started 22 very strongly. delivering excellent first quarter financial results and significant new inflows to our platform. We are on track for our 2022 FRV guidance with first quarter fee-related earnings of $32 million, which are up 85% compared to the first quarter of 2021. Distributable earnings of nearly $0.24 per share are up 90% compared to the prior year quarter. And that's our dividend to shareholders of 20 cents per share is up 90% as well. Our platform is growing with a total AUM of 96% totaling approximately $27.5 billion. And fee earnings AUM of 136% totaling approximately $19 billion. driven by both organic growth and our M&A activity. Just in the first quarter, total AUM is up 16 percent, and fee-earning AUM up 6 percent, which is all organic, with moneda already included in the beginning balance. We're now seeing significant AUM inflows from fundraising, with 1.5 billion raised in the first quarter, across a diverse range of products, putting us in a good position to raise more than $4 billion organically this year, including a first closing of more than $800 million for our seventh generation private equity fund, one year ahead of expectations at the time of our IPO. That capital is available for us to deploy immediately. And that fundraising process will continue as we move through 2022 and in early 2023, as we normally keep our flagship funds open for fundraising 12 to 18 months after the first closing. We also listed our first SPAC, Patria Latin American Opportunity Acquisition Corp., a $230 million effort. which gives our private equity business a versatile pool of capital to pursue attractive investments that may not fit our flagship fund profile. Our funds continue to perform very well, reflected in our net accrued performance fee balance of $503 million, which is up 45% just from last quarter and has doubled from one year ago. All of these points illustrate that PATRA's growth trajectory is on track and the strength of our business model allows us to maintain this momentum. While major geopolitical events and economic policy developments have undoubtedly changed the world around us in the past few months, PATRA continues to march forward and we believe our business continues to be well positioned for success in this environment. Indeed, The current global landscape clearly makes a favorable differentiation between Patriot's target geography, Latin America, and the rest of the world. Latin American economies are typically net exporters of commodities that are in high demand today, which speaks of increasing trade surpluses and stronger foreign investment inflows. Also, geopolitical risk for the region has been historically very low and uncorrelated with more problematic areas. Furthermore, there were never experiments with zero interest rates or massive quantitative easing programs in the region, which resulted in current lower leverage in public and private sectors compared to advanced nations or even other emerging markets. Lastly, Most Latin American economies have lower fiscal deficits, higher domestic interest rates, and exchange rates that are still undervalued vis-a-vis other geographies, which is quite a suitable mix to face turbulent times. It is not simply fortuitous that the S&P Goldman Sachs Commodity Price Index was up 34% in U.S. dollars year-to-date to the end of April. And the MSCI stock market index for Latin America had also risen by 9%. In the same period, the broader global MSCI index was down by 13.5%. Currencies, fixed income, and other assets were showing similar performances. This uncorrelated Latin American performance is by no means an anomaly. On the contrary, it has happened time and again. Against this backdrop, economic activity and investment returns in Latin America have outpaced most of the rest of the world. Now, turning back to Patria, we saw strong progress across all of our major asset class verticals in the first quarter. Both value creation and strong currency appreciation benefited the current portfolio in the quarter. And we are in the early stages of a fundraising cycle that we reload our platform for the next several years. In private equity, we had more than a billion dollars of AUM inflows, driven by the first closing of more than $800 million in our next vintage flagship fund, as well as the SPAC listing, which raised an additional $230 billion. While the SPAC will not earn management fees like our funds, It can contribute significantly to our earnings in the future through the sponsored promotes that PATRIA earns in the form of shares in the resulting business combination. The private equity portfolio continues to generate outstanding performance, with Fund 5 and Fund 6 generating 32% and 27% net IIRs in U.S. dollars, respectively. Fund 5 now has accrued more than $300 million in net performance fees. We also closed the first trench of our previously announced transaction with Kamaru P, which anchors our new growth equity strategy, and we have kicked off our process to jointly raise a new growth equity fund. In infrastructure, the current funds continue to deliver performance and some great stories in the portfolio. Infrastructure Fund 3 is now generating a two times multiple and 13% net IIR in U.S. dollars and has quickly ramped up its net accrued performance fees from less than $10 million one year ago to $110 million a day. Infrastructure Fund 4 is much earlier in its lifecycle, but is generating a 1.7 times multiple and 37% net IIR in U.S. dollars. as the team looks to finish committing the fund's capital this year. Our investment team continues to evaluate a pipeline of actual projects totaling more than $25 billion, which, by the way, is more than 10 times the size of our current fund. Most of the AUM in credit and public equities relates to our Moneda products, and we are off to a great start as we continue to integrate and pursue cross-selling synergies. Credit AUM is up 7% in the quarter, driven by both new inflows and solid performance. It was a challenging quarter for credit markets globally, with the increasingly hawkish US Federal Reserve driving the yield curve upwards and the situation in Ukraine contributing to wider credit spreads. Despite this backdrop, Moneda's flagship credit strategies beat their benchmarks during the period. For example, Our Latin high-yield strategy outperformed the benchmark by more than 320 basis points in this first quarter and by more than 850 basis points over the last 12 months. As noted earlier, the Latin American region benefits from having well-capitalized corporate issuance, many of them commodity producers, which resonates well with clients in this higher interest rate environment. Public equities AUM increased 18% in the quarter, driven mostly by strong portfolio performance, as we saw the best quarter for Latin American equities since 1991. The combination of higher commodity prices, depreciated currencies, and companies with capital expenditures disciplined are producing record free cash flow, which is being distributed to respected shareholders. Looking at the sum of these parts, I see a scaling investment platform that is delivering outstanding performance to investors across a diversified range of products and asset classes, with opportunities to expand asset classes, improve our local distribution capabilities, and continue our journey to become a truly comprehensive provider of alternatives investing in the region. With that, I'll now turn over to Marco for more details on the results and come back with some final thoughts on the year ahead. Marco.
spk03: Thank you, Alex, and good morning, everyone. As Alex noted, we are off to a great start in 2022, and the results clearly tell the story. Fee-related earnings of $32 million in the first Q22 are up 85% compared to first Q21. and up about 30% compared to last quarter when adjusting to the incentive fees revenue that is seasonal in the fourth quarter. The FRE margin of 58% here in Q1 is a little higher than 2022 guidance, but assuming some incentive fees hitting the top line in Q4, we still expect the full year margin to be in the low to mid-50s range. Management fee revenue of $54.6 million is up 74% compared to first Q21 and also up about 30% compared to last quarter, reflecting both the full impact of Moneda as well as incremental fees on the $750 million we deployed in our drawdown fund in the second half of 2021. We earn incentive fees on certain moneda funds, as well as our pipe funds, which are measured and realized each year relative to performance against the fund's benchmark, and most of which are realized in the fourth quarter. As of March 31st, we have accrued approximately $4.2 million in incentive fees at current performance levels. On the cost side, personal expenses of $15.1 million are up 46% from first Q21 and up 36% from 4Q21, mostly reflecting the addition of moneda team. To put in context of an FRE compensation ratio, we expect personal expenses in 2022 to ultimately be around 30% of net revenues. Looking below FRE, we generated $4.8 million in net financial income in first Q22, driven by both realized and unrealized gains, mostly attributable to the balance sheet investment in our infrastructure core fund launched last year. On corporate taxes, our effective rate for Q1 was approximately 5% on pre-tax distributable earnings. As we noted in the past, we expect this rate to gradually rise to around 10 percent over the course of 2022 and 2023. Our net accrued performance fee again rose to a new record high of $503 million, up significantly from $348 million last quarter, driven by both positive valuation impact and the improvement in the local currency rates during the quarter. The accrual now equates to more than $3.40 per share and is becoming more diversified each quarter as funds like Infrastructure Fund 3 and Private Equity Fund 6 continue to progress alongside Private Equity Fund 5. We believe our current valuation is getting very little credit for this imbecilous value to be monetized in the future period. Total AUM of $27.6 billion is up 96% compared to one year ago, driven not just by the addition of moneda, but also by $1.5 billion of fundraising inflows and more than $3.6 billion of valuation and currency gains. The AUM is up 16% just in the first quarter, with both the resurgence of fundraising activity and the positive moves in the effects rate. Fee earnings AUM of $19 billion is up 136% compared to one year ago, with about 30% of that increase being organic and driven by our strong deployment pace in 2021. Fee earnings AUM was up 6% compared to December 31st, as our flagship fund, added the net deployment from the second half of 2021. And we saw some nice appreciation in our credit and public equities products. As we look the remainder of the year, you've heard our message that FRA guidance is on track. A 50% increase from the 86 million generated in 2021 equates to just under 130 million for 2022. For perspective, annualizing just the Q1 FRE result of $32 million would imply year-over-year FRE growth of 48%. That does not yet account for any FRE growth throughout the year as we deploy capital, nor does it account for any incentive fees which would be crystallized in Q4. We don't guide on performance-related earnings because it's simply too difficult to predict exit timing. But one thing is clear. Our portfolio continues to generate gain for our investors and accrue a larger inventory of performance fees for shareholders. Private equity fund five and infrastructure fund three are more mature and beginning their divestment cycle. And these funds have multiple paths to return capital and satisfy the waterfall threshold necessary to begin realizing the accruals. The timing and pace of divestment activity will determine when we reach that point, and we will have to see how that progresses during the year. To conclude, I'm very pleased with our results for the quarter and our trajectory toward another great year. I will now turn back to Alex for closing thoughts.
spk04: Thank you Marco. At PATRE we build our reputation as trusted long-term investors and likewise we have a long-term vision and mindset for what PATRE can become in the future. Along the way we believe there is tremendous value for shareholders as we scale and expand the platform and grow our earnings capacity. We're also excited about the timing in Latin America as we think the region stands out as a particularly attractive investment destination for global investors given the emerging challenges elsewhere in the world. Our top priority is always investment performance because that is the core of what we do and it drives every other element of our business. With that as a constant, we have a few key areas of focus this year. Number one is FRE execution. We are in year two as a public company, and our management team is highly focused on delivering our guidance. And as demonstrated by our first quarter results, we are well on track. Number two is fundraising for a growing suite of products. Our team is hard at work raising the remainder of our newest flagship private active fund soon to be followed by flagship infrastructure, which will effectively reload our dry powder for several years to come. Number three is divestment progress. Our professionals are searching for great deployment opportunities, as always, but also particularly focused on divestment opportunities in more mature funds like Private Active 5, and already for a relatively young fund, like Infrastructure 3. Divestment progress, of course, returns capital to our LPs, which helps fundraising efforts and also brings us closer to monetizing the substantial accrued performance fees in those funds. And finally, number four is platform expansion through M&A. Our team continues to evaluate and pursue a number of interesting targets, which could be a great fit for the Patrick platform, an enhanced product offering, geographic expertise, and local distribution capability. We will be focused not just on increasing the size of our platform, but joining with partners who can expand our collective investing expertise and ability to generate alpha for our clients. We hope and expect to have more specific news to share on that front soon. As we execute on these fronts, we will continue to deliver significant value to our shareholders and finish the year with an even larger platform positioned to deliver significantly higher distributable earnings in the coming years through both fee-related earnings and performance fees. Thank you all for joining us today. And we are now happy to take questions.
spk08: As a reminder, to ask a question, you need to press star 1 on your telephone. And to withdraw your question, just press the compound key. Once again, that's star 1 for questions, 1 for questions. Our first question will come from Marcelo Tellez from Credit Suisse. You may begin.
spk05: Hi, good morning, everyone, and congratulations on the very strong results. I have two questions. The first one, regarding your fundraising activity, I mean, congrats, you had your first closing on your Next Generation PE fund. And my question with that regard is, you know, how do you see, you know, that playing out, you know, going forward? Is this amount, you know, you know, been better, you know, or in line with your expectations? Has the, you know, this volatile environment, you know, affected in any way, let's say, the timing of your fundraising or maybe not? And it also, you know, called my attention the nearly $450 million in fundraising and moneda. And, you know, if you could dig a little bit deeper and understanding, I mean, you know, how much of that, you know, was related to, potential synergies with Patria, or if this was really more related to investors searching for higher-yield investors, as you commented a little bit in your initial remarks. So it would be great to understand that. And the other question with regards to your divestments going forward I mean, we've seen a big increase in M&A transactions in Brazil and in this environment. Do you think that facilitates your ability to divest in 2022? I know you don't give formal guidance for that, but how should we think about your divestment schedule? in this higher M&A environment. Thank you.
spk04: Okay. Hi, Marcelo. How are you? This is Alex Saig speaking. Thanks for joining us this morning. How are you? Nice to talk to you over the phone again and hope to see you in person soon again. So going back to your first question on fundraising for PrivateXE7, As far as timing and expectation, I think we're right there where we want to be and very aligned with previous fundraisings for private equity 6, 5, et cetera, going back in time. We normally have a first close, which is approximately 25 to 35% of what we announced that we want to fundraise. In this case, we have on the cover of our prospectus $3.5 billion with an upside case of over four. In our industry here, they call it a hard cap of a little over four. So $800 and something million over the $3.5 billion. That's the math that the industry does of the KPI for a first close. We're right on track. We do normally, as in other past fundraising processes, keep the fund in a fundraising mode 12 to 18 months after the first close. So we have all the way to, I'm exaggerating here, but technically speaking, all the way to October of next year, which is 18 months for March, to fundraise for Pride Electives Fund 7. We are seeing a good market to fundraise, and I think it changed over the end of last year to the beginning of this year to the better for Latin America as a whole, I would say, and for Patria as we are the leading alternative house in Latin America. If you go back, I think, Marcelo, 18 months to 24 months, how the region was doing on treating COVID, and we had low vaccination programs in the region, and some of the leaders in the region were being questioned by the market if they were going to be fiscally disciplined, et cetera. Now, if you turn that movie, that video there for 24 months and you get back to today, I think most of these macro questions have been answered positively for the region, as you know. And in addition, we were already seeing a commodity cycle upswing as of the second half of 2021, which helped the region, of course, because most countries here are net exporters of commodity, getting to the Ukraine war that nobody, of course, wanted to have this war ongoing, but it did benefit the region because of the low geopolitical risks and the commodities prices also continuing to strengthen. So on the macro side, I think the situation turned to our side. And in addition, when you double-click there, as far as Patriot is concerned, we have great funds, private active funds with over 30% net IR in dollars. A lot of re-ups of our current LPs in this first close. We're going to have another close in the second quarter of this year. And keep on going. What is some of the backslash on fundraising, which is a good reason, but it's a backslash. I think the industry has been performing extremely well. You probably know the private market's in 2020 and 2021 had record IIRs and DPIs as a whole in general. So investors are extremely happy with the asset class, and I'm putting all of the alternative assets in this big private markets asset class, and most of the asset classes within private markets performed extremely well over the last two years. And what happened, and it's a good problem to have, but it's a problem. Investors now then in their portfolios are over allocated to private markets because now if public markets don't actually go up or come down and private markets go up substantially as it did over 21 and 2020, the allocation, the percentage of your portfolio allocated to private markets increased and sometimes it actually went over what theoretically you had approved by the respective board or your pension fund or your sovereign fund, et cetera. So most of our clients are having to go back to their boards or investment committees and approve a higher allocation to private markets. It's a good problem to have, but again, the whole process takes a little longer, et cetera. That's A. where now we're facing, of course, higher competition, because the whole know a lot of other funds also performed very well in 2020 and 2021. So even though the performance of our funds are the highest ever, to be honest, from five and from six, other funds also performed well in other parts of the world. So that was going on. When we come into no 2022. And The geopolitical risks that happened because of the Ukraine war, actually the geopolitical risk increased because of the Ukraine war, and several investors then went back to look at Latin America as a desired place to invest because of everything that I just said. So I think, again, I started with a conclusion here. Now we're on track with our fundraising pace, as you asked. What we wanted to raise in our first close was what we did raise, 800 out of 3.5 billion, which is on the cover of our perspective. It's exactly the textbook fundraising case. And I'm happy. And we're already having a second close in the second quarter. And then gave you a double click. I think there's two forces going on here. I think Latin America in general has been on the move to attract attention from investors and But at the same time, the industry performed extremely well over the last two years, which is a good problem to have, but we have a tougher competition in the fundraising side. So these are the forces going on here. Then you asked about the Moneda. Our fundraising synergies with Moneda have not actually kicked in yet, or they did in a general sense, now having Patria and Moneda together, investors are very, very happy with that combination. But we haven't seen a lot of the patria long term institutional investors already convert because we didn't have a lot of time, as we did actually combine the businesses in late last year. There was not enough time to then officially not technically legally been able to go to on the road together, and already have positive inflows in the first quarter. So we're going to see this kick in as we move into 2022. So I was very impressed, to be honest, with the amount of money that Moneda raised in the first quarter. And it has to do with performance. Of course, it has to do with their relationships. They have great relationships with very, very sizable institutional clients all over the world and, of course, inside Chile as well. But performance, I think, attracted a lot the inflows. I mentioned during my speech here that their equity funds performed extremely well in the quarter and their credit funds, which was not an easy market, performed extremely well. I mentioned the 300 and something basis points over the benchmark in the first quarter and over 800 and something basis over a longer period of time before credit on that substantial alpha. On the divestment side, we've definitely turned the knob to divestments. And on a macro sense, what did we do? Last year, we were pressing the pedal on investments because we had EBITDAs that were hurt because of COVID. And so we also have lower multiples because the whole situation that I just described, it's kind of question mark over Latin America that got it raised over the latter part of 21, beginning of 22. And we also had a weaker currency in the region. So we turned the knob to investments and we had our record year for investments, as you know. As we come into 2022, we turned the knob and the focus to divestments. And that's because again, All these three things that I just mentioned turned the way in favor of divestments. We have stronger local currencies, so the dollar-denominated funds do show better returns. We have the COVID kind of uncertainties kind of out of the table because of the very successful vaccination programs. The economies are growing again. Fiscal discipline from the leaders in the region and from the main leaders in the region, etc., you know, favoring the region, as you said, a very active activity in 2022. And so we were using that general situation that's favored by investments to actually then sell several of our companies in the private equity and the infrastructure portfolio. So we're very, we're happy with where we are. We have, to be honest, over 15 companies that we actually have a, a sale process going on in a portfolio of 35, and 10 of those are very recent investments. So like 15 out of 25 companies that we are actively pursuing a divestment, which is substantial, it's two-thirds of the portfolio, because of the situation that I described and that you alluded to as well, given the active M&A activity in the region. Most of that interest are coming It's coming from strategic global investors that are willing to invest in the region. So we did sell earlier this year, for example, in the private equity portfolio, an elderly living company for the largest elderly living company in the world. It's a French company that is listed in the Paris Stock Exchange, and so we have no infrastructure assets being sought after by global strategic players. So over 90% of the interest that we're seeing for our portfolio companies, the ones that I mentioned that are in a process of being sold, we see interest from global strategic investors that are willing to invest in the region. Long answer to your question, but I hope I addressed all of your points.
spk05: No, you did address. Thank you so much, and the very detailed answers, and congratulations on the results. Again, great start of the year.
spk08: Thank you. Thank you. Our next question will come from the line of Peter Latarta from Goldman Sachs. You may begin.
spk07: Hi. Good morning. Alex in Marcos. It's a Tito from Goldman Sachs. My question is on the deployment. I just want to see how you think about the ability to deploy capital in the current market environment. You know, you've deployed around $2 billion over the last 12 months, yet in the quarter it was only $55 million, and mostly in others and not in private equity or infrastructure. Where do you see opportunities to deploy capital in a particular industry, just given the current market environment? How do you think about that outlook? Thank you.
spk04: Thank you. Nice talking to you again, and thanks for participating in our call. We still keep the $2 billion kind of guideline for investments this year, as I think we mentioned earlier. It's There's several, I think, very interesting opportunities as we move along on the private equity side in agribusiness and healthcare are the two verticals that we see a lot of things that we would love to invest. In addition, logistics and food. So these are the four sectors in this kind of order. Agribusiness, as you know, has been booming in the region and in Brazil specifically because of the strength of the agribusiness in that country. Healthcare, food, and logistics are those sectors that are also performing well. You probably know that the economies in the region have been actually beating some of the expectations. as you probably know, even Brazil, that I think the general consensus was that the economy was going to retract this year. I think most of the economists that are analyzing the region, and specifically Brazil, are changing their expectations to a growth scenario, 1% to 2% growth. And we can see that, I think, our companies perform very well, most specifically private equity companies that have more to do with... and the performance of the economy at the infrastructure assets. Most of them have contracted already revenues, right? When you, when you participate in a knock, an entity auction and whatever. So on the private equity side, now we finished the first four months of the year revenues of all the companies. If you add all of the companies, they are a little bit above budget and we have, and we had a very aggressive budget given that we were foreseeing and expecting a return from COVID levels. So we are happy to see that, of course, some companies performing better, other companies performing not that aligned with budget, but I think we are like plus 7% to minus 3, 4% from budget. So no variances, but not a lot of variances. It's not like one company is plus 50% and the other company is minus 50%. It's plus 7, minus 3, 4% from budget uh so and we're very happy to see that number uh for the month for four months of 2022. um on the infrastructure side i think energy continues to be a great focus of ours as logistics as well from the infrastructure side for example uh the the toll roads etc that we uh you know are very keen to continue to invest we have a great year in that sense with great toll roads being auctioned in 2022-23. Our team is really focusing on that sector to continue to invest. So the $2 billion kind of guidance continues to be our internal base, and you will probably see a pickup in the second quarter and going forward.
spk02: And just to complement, Tito, this is Marco. Good morning. The way we allocate our deployment implies that we reserve to then get into execution. So there's been a lot of execution of underlying M&A activity going on in the quarter that doesn't really show up on the bridge, but the M&A teams have been very, very active on the execution of the investment thesis that Alex alluded to.
spk07: Great. Thank you, Alex and Marco. That's helpful. Yeah, I guess that kind of answers my follow-up. Yeah, was there anything else specific in one queue that you didn't deploy much? Was it just that you were kind of active in that M&A that you mentioned, or was there anything else in the quarter that didn't allow you to deploy much capital?
spk04: No, it was no real big reason, to be honest. I think it was just renegotiations going on. I think that our expectations of value versus the sellers. But there was no specific reason, to be honest. I think it was a normal process that sometimes it just jumps from one quarter to the other. But I don't see any decreasing in the momentum of the investment base.
spk07: Great. Thank you, Alex.
spk08: And once again, that's star one for questions, star one. Our next question will come from the line of Robert Lee from KBW. Your line is open.
spk06: Great. Thanks. Good morning. Thanks for taking my questions. I apologize if you went over this earlier. I got to the call a little late. Could you update us on where you are with Infra 5 since you're pretty much deployed and reserved on Infra 4, I believe, and then also any update on your new growth equity strategy that you were launching and receptivity there and expectations there?
spk04: Yes, of course. This is Alex again, and thanks for participating in our call. Of course, I think on the April 5th, I think we are there very much in line with our new schedule, kind of one year ahead of our schedule that we defined during our IPO process. So we're going to start fundraising next year. We were expecting to start fundraising, in 24 for InforFive. We are building this momentum and interesting, we're already having a lot of LPs asking us on when the next InforFund is going to come on to market. There's not a lot or actually very few opportunities for investors to expose themselves to the real assets or the infrastructure sector in Latin America. and we're definitely the number one in that sense. So happy to see reverse inquiries from our LPs for Infra 5. And the way that we're building the whole case here, we are also actively divesting several of our infrastructure assets, as we mentioned during the call. And that actually builds momentum to drive money back to investors, increase our DPI indicator. The returns of the funds are looking great. So we have all of this planning phases and several processes going on in order to maximize the whole probability of raising a very strong infrastructure five next year. So if everything goes as planned, which is the returns of the fund continues to be strong as they are, as you saw in the first quarter for infrastructure, number two, we continue to deploy money in very interesting auctions and other infrastructure assets that I think we're very convinced that we will. And number three, we managed to sell the assets that are already on sale. I think that's going to be good news on the infrastructure side on the divestment front this year. So all that builds momentum to, and we're receiving already reverse inquiries on our fundraising process for Interfund 5. So as we go into market in 2023, we have all of the KPIs already in the right place. Investments, divestments, DPI, and returns all looking good for a great process. I'm very confident on fundraising for Info 5, and I think we are really building great momentum there. And again, we are one of the few options and the best options for investors to get exposed to the very active privatization and concessions sector in general in Latin America. As far as private equity growth is concerned, our fundraising process here on Gates look like we're going to have a fundraising this quarter. First close for the fund. Also looking very strong. As you know, we plan to raise $200 million, which is the number that we actually did announce that was already aligned with the Camaro Pink partners. The way that I see it today, I think there's a very good chance that we're going to reach the number, beat the number. Again, I think the first close within this quarter looks in line with our expectations and the expectations of our LPs and our commodity partners. We're already investing the fund as we speak, so that also pushes fundraising on the good side because investors are actually managing to see some of the assets that are already in the fund. We already have three assets in the fund and we already signed EMOUs for another couple of assets and that also on private equity growth, not for private equity buyout or infrastructure development, that doesn't work that way, but fundraising for private equity growth already having some assets in the fund helps the fundraising process. So we already have three assets in the fund and actually going to have another two as we fundraise in the next quarter. So I'm confident there as well. Of course, $200 million, given the size of things within Patriot, it's important on a strategic side, and because of the performance fees that actually this fund generates, it doesn't move much the needle on the management fees on the $200 million itself. But I think the whole process of having a product that targets that part of the lifecycle of the company, the early part of the lifecycle of a company, and the potential performance fees that such funds do realize are very important for us. Thank you.
spk07: Great. That was it. Thanks for taking my question.
spk04: Oh, it's a pleasure.
spk08: Thank you. And I'm not showing any further questions in the queue. Let's try to call back over to Alex I for any closing remarks.
spk04: No, thank you very much, everyone. And thanks, Rob, also for your question there from from KDW. Thanks a lot. I know for all of your participation there and questions. I think we are, of course, more than available after the call to keep on taking your questions. Hope to see you guys in person very soon. Hope all of you are well, your families are well. And thanks, Josh and Mark, as well, for the call. And if Josh and Mark doesn't have anything else to add here, I think we are... That's it, right, Josh? Yeah. So thank you very much, guys. Have a good day. Be well, be safe.
spk02: Thank you, everyone. Thank you. Have a good day.
spk08: This concludes today's conference call. You may now disconnect, everyone. Have a great day.
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