Actis commits $250m to Mexican energy

UK-based emerging markets specialist Actis has committed $250 million to establish Zuma Energía, an energy platform in Mexico that will target more than 500 MW of capacity across the country.

This investment comes from Actis Energy 3, the firm’s third energy-specific fund, which closed on $1.15 billion in December 2013. Actis was not immediately available for comment.

Zuma Energía completed its first acquisition today, closing the financing of PE Ingenio, a 50 MW wind farm located in the south-western Mexican state of Oaxaca. Global renewables operator Acciona Energía will construct the project and supply its 33 wind turbines. Debt finance will come from Mexico’s state-owned development bank Banco Naçional de Comercio Exterior SNC (Bancomext), while local hydro and wind developer Comexhidro is taking a 5 percent interest.

Once the wind farm is in operation, it is expected to produce enough clean energy to power more than 125,000 Mexican households, according to a statement from Actis.

“Supported by the recent reform agenda in the energy sector, Mexico has compelling fundamentals for investing in power generation, including superior natural resources, an evolving and supportive regulatory framework and a deep project finance capacity,” Michael Till, co-head of energy at Actis, said.

Since 2002, Actis, which currently has $6.5 billion in funds under management, has deployed more than $1.4 billion in 25 energy transactions across 20 countries, generating a combined capacity of more than 14,500 MW, according to the firm.

In June 2013, Actis agreed to invest $290 million for a 60 percent stake in Chile-based Aela Energia, which aims to build 600 MW of wind and solar projects by 2016. In 2010, Globeleq, an operating power company backed by Actis, funded the construction of Cerro de Hula, the first wind farm in Honduras.

By the time Actis closed Actis Energy 3 in December, it had already deployed $560 million, completing four investments in 2013. In addition to Aela Energia, the firm made a $169 million investment in Brazilian renewable energy company Atlantic Energias Renovaveis, and agreed to invest in Cameroon’s national integrated utility, Société National d’Electricité. Actis also signed an agreement to acquire Morocco’s water, waste water and electricity services.