By Fabiana Negrin Ochoa
Japan's Sumitomo Mitsui Trust Bank is taking a 15% stake in global infrastructure investment manager Morrison as part of a roughly $2.0 billion long-term strategic partnership.
Under the agreement, the lender will make an initial $500 million commitment to two of the New Zealand-founded firm's private-market strategies.
Morrison, which had over $30 billion in assets under management as of end-March, and Sumitomo Mitsui Trust Bank have also forged a $1.5 billion-plus long-term collaboration that involves raising third-party capital for infrastructure investment products in their home markets. They will also develop new products for investors.
The partnership aims to tap rising demand among investors in Japan--home to one of the world's deepest pools of long-term capital--for access to global private markets and infrastructure opportunities.
"The changing macro environment has made infrastructure a priority asset class for Japanese investors," said Paul Newfield, chief executive of Morrison.
As Japan exits decades of economic stagnation, interest rates normalize and inflation gains traction, analysts expect to see something of a capital investment renaissance in the country.
According to the deal announced Tuesday, Sumitomo Mitsui Trust Bank, a wholly owned subsidiary of Sumitomo Mitsui Trust Group, will subscribe for new equity in Morrison to take the 15% ownership stake. Morrison plans to use the growth capital to accelerate its global expansion.
"The partnership strengthens our capital base, broadens our distribution reach and supports Morrison's next phase of growth," Newfield said.
For Sumitomo Mitsui Trust Bank, the collaboration will accelerate the expansion of its infrastructure-related business overseas.
The companies expect to complete the arrangements by the end of the year, subject to regulatory approvals.
Write to Fabiana Negrin Ochoa at fabiana.negrinochoa@wsj.com