Investment manager Mirova said it has raised $171 million in the first close of its blended finance debt fund.
The Mirova Gigaton Fund aims to provide mid- to long-term debt financing for clean energy projects primarily in emerging countries in Asia and Africa, as well as in Latin America and the Middle East, the company said in an announcement.
Mirova, the sustainable investment-focused affiliate of asset manager Natixis Investment Managers, said it is looking to raise $500 million for the fund and expects to deploy $1.2 billion of private debt to small and medium enterprises.
The fund is particularly focused on solar home systems, commercial and industrial solar and mini-grids, as well as e-mobility, battery storage and carbon credit prefinancing.
To date, the fund has received commitments from the U.S. International Development Finance Corporation; Swedfund, Sweden’s development finance institution for sustainable investments in developing countries; and the Swedish International Development Cooperation Agency.
Natixis Private Equity — the private equity arm of Natixis Investment Managers — and new investors are also participating in the fund.
Mirova said the fund already has investments in over 30 countries and is looking for new places in which to invest.
Ryan Levinson, director of the Mirova Gigaton Fund, said the vehicle will help accelerate the transition to a low-carbon economy and improve energy access in the Asia-Pacific region, Africa and Latin America.
“Addressing climate change requires a reallocation of capital to decarbonizing global economies, particularly a clean energy transition in emerging markets,” Levinson said.
Founded in 2014, Mirova says it is committed to responsible investment and has signed the United Nations-supported Principles for Responsible Investment.
Mirova says its investment process involves rigorous analysis of environmental, social and governance (ESG) factors, as well as engagement with companies to encourage them to improve ESG practices.
Corporations and venture capital funds have been raising dedicated vehicles and deploying capital in Southeast Asian startups to tackle environmental problems.
For instance, Singapore’s Wavemaker Partners launched its climate tech venture builder Wavemaker Impact in October 2022, while Atlas Capital aims to raise a $10 million debut fund for its climate tech fund.
Singapore-based Circulate Capital closed its second fund Circulate Capital Ocean Fund I-B (CCOF I-B) in July last year, bringing the vehicle’s total commitments to $53 million.
