Fortis to raise €400m for clean energy

Several months after a merger with ABN AMRO Asset Management, the Paris-based asset manager has set out to raise an ‘infrastructure-style fund’ making project-level investments in wind, hydro, solar and biomass.

Fortis Investments has launched a clean energy fund raising €400 million ($577 million) with a cornerstone investment of €50 million from parent Fortis Bank.

The fund will focus on project-level investments in wind, small scale hydro, solar cells and biomass, which Fortis technical director Peter Dickson called the “prudent core technologies that give us the risk profile that we’re looking for”.

Dickson noted that these are areas of clear energy which have been operational and have a track record of use in numerous projects.

“What we are proposing here is an infrastructure style fund targeting returns of 12 to 14 percent,” Dickson said.

Up to 25 percent of the fund may be used outside of the four focus sectors although no investments will be made in emerging technologies, said Dickson.

The fund will deploy 70 percent of its capital in Europe with 30 percent allocated to select emerging markets. Brazil and India were highlighted by Dickson due to their fast-growing demand for electricity and legislation promoting renewable energy.

In terms of sourcing deals, developing a small number of relationships with developers is “key to the strategy of acquiring projects and developing a secure long-term pipeline”, Dickson said.

The clean energy fund has been in pre-marketing for approximately three or four months and has received substantial interest from institutional investors, family offices and high net worth individuals throughout Europe, said Dickson. The next week will be spent meeting with potential investors in Hong Kong and Japan.

Fortis Investments is a global asset management company with €209.2 billion in assets under management following the merger in April 2008 of Fortis Investments and ABN AMRO Asset Management. The latter was acquired by Fortis in the consortium bid launched with RBS and Santander for the whole of ABN AMRO in 2007.