Aviva Investors, the asset management arm of global insurance group Aviva, is targeting commitments of at least €500 million for a European renewable energy project fund.
It was officially launched today at the Triple Bottom Line Investment conference in Amsterdam as part of Aviva’s continued push into socially responsible investing, the firm said.
Marketing will begin in December and the fund expects to hold a final close in the first quarter next year, assistant fund manager Fabian Watts said in an interview.
“We’ve been in soft marketing and so far the feeback has been very good from institutional investors,” he said, noting that it's the first UK-based fund investing in alternative energy projects versus the technology used for them.
The fund will invest in solar photovoltaic, geothermal, biomass, biogas and wind assets across the European Union. The projects in which it invests will be managed by Germany’s SachsenFonds Group, which is the developer of the world's largest solar energy farm in Brandis, Germany and has more than €300 million of renewable energy projects under management.
The partnership “combines Aviva Investors’ pedigree in fund and asset management and SRI expertise with the excellent track record of SachsenFonds in the renewable energy sector”, Joel Lindsay, Aviva fund manager, said in a statement.
SachsenFonds, an investment arm of asset-based finance group EastMerchant, has worked with Aviva's real estate investment division on numerous funds including Aviva's €600 million Central European Property Fund.
Aviva said its Luxembourg-registered special investment fund will capitalise on EU initiatives to increase sustainable energy consumption from 8.5 percent to 20 percent by 2020. It will target an annual gross equity internal rate of return of 10 percent to 12 percent, and forecasts a quarterly distribution yield in excess of 6 percent.