InfraRed Capital Partners is looking to hold a first close next quarter at up to USD 700m for its seventh flagship infrastructure fund, according to three sources familiar with the process.

The London-headquartered manager is seeking USD 1.5bn for InfraRed Infrastructure Fund VII, with a hard cap of USD 2bn, as reported. InfraRed is looking to raise USD 600m-USD 700m by first close, the sources said.

The fund agreed its first seed investment in August, buying a majority stake in US rail terminal and export logistics business Rail Modal Group, according to one of the sources. The deal was an “important milestone” ahead of a first close, the person added.

The fund, which targets development-stage infrastructure across OECD markets, targets lower mid-market investments of USD 100m-USD 200m and aims for a net IRR of around 15%.

Fund VII’s predecessor, InfraRed Infrastructure Fund VI, closed at around USD 1bn of commitments in November 2024.

Its Fund VI portfolio includes Voltan Energy, a Finnish heat pump business; Wondrwall, a UK home energy management company; and JOLT Energy, an e-mobility company based in Dublin and Munich.

Last month, it bought nine UK schools PPP projects from INPP for a separately managed account with APG.

InfraRed agreed to buy Scandinavian rail freight operator Hector Rail through “InfraRed-managed funds,” without identifying them.

InfraRed also took a majority stake in Spanish data centre developer NxN in December 2025 and agreed to acquire Rogers Communications‘ Canadian data centre business for its value-add strategy in August 2025. It is unclear which funds were used for these investments.

InfraRed Infrastructure Fund VI was 45.88% deployed as of 30 September 2025, while InfraRed European Infrastructure Income 4 was 87.54% deployed as of 31 December 2025, according to Infralogic.

InfraRed also recently filed offers for Westerleigh and VTG UK, as reported.

InfraRed, part of Canadian insurer Sun Life, managed USD 13.3bn of equity at the end of 2025, according to its website.

The fundraising comes as SLC Management, the asset management arm of Canadian insurer Sun Life, considers combining InfraRed with its other investment managers under a single umbrella company, as Infralogic recently reported. The proposed move could affect InfraRed’s brand and operations, although SLC has not announced a merger.

InfraRed declined to comment.