Climate change FoF holds first close

F&C Investments' climate change-focused fund of funds aims to raise up to €100m.

F&C Investments has held an initial close for F&C Climate Opportunities Partners on €30 million, having won commitments from three institutional investors.

The firm is targeting double that amount for the fund, and has set a hard-cap of €100 million, according to a spokesperson for the firm.

“Policies to cut greenhouse gas emissions, and to adapt to the worst impacts of the changing climate, are having a transformational effect on the global economy, providing a range of opportunities for companies providing climate change solutions,” it said in a statement. “Many of these companies are private and will require private equity backing to capitalise on their climate change business opportunity.”

Policies to cut greenhouse gas emissions, and to adapt to the worst impacts of the changing climate, are having a transformational effect on the global economy.

It will invest at least 70 percent of the fund in private equity vehicles which offer “exposure to climate change themes”. Up to 30 percent may be invested in renewable and sustainable project-focused funds, F&C said in the statement.  
Management fees will be set at 1.5 percent of total commitments, the firm said. So far, the firm’s in-house team has handled the fundraising but it expects to mandate placement agents in due course to help raise capital from specific geographies, the spokesperson said.

F&C said it aims to commit to between 12 and 15 funds, and also expressed its willingness to co-invest alongside GPs.

Hamish Mair, Head of Private Equity Funds at F&C, said: “We believe private equity represents an attractive way to gain exposure to the climate change investment niche. As an investment theme, climate change is universal in relevance, unprecedented in scale and sustained in longevity.”

The fund’s management team will also leverage the expertise of F&C’s governance and sustainable investment team headed by Karina Litvack.