Private Equity News & Analysis

SAM closes alternative energy funds at E86m

Sustainable Asset Management has completed its first private equity fundraising efforts with closings on two related vehicles that will invest in alternative energy companies.

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Sustainable Asset Management (SAM), the Zurich-based asset management firm, has completed its debut private equity related fundraising effort at E86m, almost twice the original target.

SAM had initially looked to raise a E40m fund aimed at the health and nutrition, resource productivity and emerging energy market, but found upon launch in 2000 that the sector investors were particularly keen on was energy.

“When we began fundraising in 2000, we set a E40m target, but quickly found that a number of investors wanted to invest predominantly in energy, which is why we created a subsidiary energy fund,” said Hans Dellenbach, a fund manager at SAM.

Now SAM Sustainability Private Equity LP has closed at E37.8m, while the subsidiary fund, SAM Private Equity Energy Fund LP was capped it at E46.6m and will focus on emerging energy companies. Both vehicles are managed by SAM Equity Partners, SAM’s wholly owned subsidiary.

Lead investor in the energy fund is Hydro Quebec Capitech. Other investors include Sofinov, Ontario Power Generation, Suncor Energy, EDF Capital-Investissement, Norsk Hydro Technology Ventures and Mitsui. Investors in the sustainability fund include Swiss Re and Gerling.

The funds have both company stage and geographical allocations. Around 70 per cent has been set for early stage companies, 10 per cent for seed investments and 20 per cent to pre-IPO. Target companies will be predominantly European, said Dellenbach. “But we have set aside 30 per cent for North America,” he added.

To date six investments have been made. These include capital to AgraQuest, CellTech Power, Evergreen Solar and Oxford Natural Products. Dellenbach said another six investments will be made this year and six next year, which will see the funds fully invested by the end of 2003. SAM has yet to complete an exit.

SAM, formed in 1995, focuses on sustainability investments, working with banks, insurance companies, pension funds, trusts, foundations and private investors. The firm is headquartered in Zollikon-Zurich and has offices in the US and Australia.