Copenhagen Infrastructure Partners has received commitments totalling $700m (€625m) for a new fund to invest in renewable energy mainly in Latin America and Asia.
The New Markets Fund received $250m from PensionDanmark, as well as investments from Arbejdsmarkedets Tillaegspension (ATP), Kommunal Landspensjonskasse (KLP) and Laegernes Pension.
CIP said it expects the fund to reach $1bn by final close, which is expected within the next nine months.
The fund will target greenfield renewable energy infrastructure projects primarily in Asia and Latin America, as well as certain countries in Eastern Europe and Africa that have scale, growth, and liquidity.
It will consider offshore and onshore wind, solar, biomass and waste-to-energy and transmission grid projects among others, CIP said.
The fund has a 10-year term and will apply a ‘build-and-exit’ strategy, funding construction and then exiting the investments once plants are operational.
CIP managing partner Baruel Poulsen said: “Obtaining first close commitments of $700m from a group of leading Nordic investors is an important proof of investor confidence in CIP’s approach to energy infrastructure investments and a testament to the track record built with CIP’s Western Europe and North America focused energy infrastructure funds.
“The CI NMF I is a significant step in CIP’s continued expansion as it broadens our offering to also include infrastructure funds targeted at fast growing major new economies.”
PensionDanmark chief executive Torben Moger Pedersen said: “CIP has come a long way since PensionDanmark and CIP’s senior partners established CI I back in 2012 with PD as sole and founding investor.
“CIP has demonstrated its ability to develop and construct renewable infrastructure projects in Europe and America on time and budget and has delivered very attractive returns to its investors.
“We see the New Markets Fund as a natural next step to broaden the investment universe to new markets in Asia and Latin America where there is a significant need for renewable energy investments that represents attractive investment opportunities for CIP and its investors.”
ATP head of global direct investments Ulrik Dan Weuder said: “We are delighted to invest into CIP’s New Markets Fund. This investment fits well with our ambition to create strong returns to our members based on sustainable investments.”
KLP senior vice president risk and asset allocation Harald Koch-Hagen said: “Our experience with CIP from our investments in the developed market funds is very good.
“We have full confidence in their ability to replicate this success in a number of fast-growing economies outside the current core developed markets.
“This new fund is also a great opportunity to expand our commitment to catalyse investment in renewable energy infrastructure in fast-growing economies in Asia and Latin America.”
Laegernes Pension chief executive Chresten Dengsoe said: “Laegernes Pension has invested alongside CIP for the past five years in profitable and sustainable infrastructure projects in developed markets.
“We look forward to transferring that knowledge into emerging markets.”
In connection with the establishment of the fund, the CIP team has been expanded to include a dedicated investment team for the New Markets Fund with energy and M&A experience in Asia and Latin America as well as certain countries in Eastern Europe, Middle East, and Africa.
The New Markets Fund investment team will be headed by newly-appointed CIP partner Niels Holst, who was previously managing director in the financial advisory firm Capricorn Real Assets.
Holst will be joined by a group of senior professionals recently recruited from leading institutions to join CI NMF I, as well as current CIP team members.