Cathay SITE eyes January first close for debut fund – exclusive

The Taipei-based firm is seeking $330m for its first vehicle to invest in domestic renewable energy projects.

Cathay Securities Investment Trust (SITE), the asset management subsidiary of Taiwan’s largest financial services company Cathay Financial Holdings, is preparing to launch its first private equity fund focused on renewable energy, Private Equity International has learned.

The firm is targeting NT$10 billion ($330 million; €280 million) for the fund, whose name has yet to be finalised, according to Andy Chang, president and chief executive of Cathay SITE.

Chang added the firm expects to hold a first close by the end of January next year and a second and final close in April.

Capital raised from the fund will be invested in Taiwanese companies focused on renewable energy, recycling economy and new agriculture technology.

“The fund is aligned with the Taiwanese government’s push for renewable energy, which will account for 20 percent of Taiwan’s power supply by 2025,” Chang said.

Limited partners in the fund are mostly Taiwanese investors. “We are seeing a positive response from institutional investors such as life insurance companies, pension funds and high net worth individuals.”, Chang said. “We see huge potential demand for private equity from our investors because the investment risk is lower, visibility is higher and return expectations are at around 5 percent.”

Cathay SITE has $18.4 billion in assets under management as of 30 September, invested across fixed income and global and domestic equities.

Its affiliate Cathay Life Insurance had committed over NT$1 billion ($33 million; €28 million) to solar power generation since last year, including picking up a minority stake in Swiss-based Partners Group‘s greenfield platform and a commitment to a joint venture with local solar panel maker Neo Solar Power Corporation.