Mirova, an affiliate of Natixis Investment Managers, has launched an impact-focused private equity fund, seeking to raise €300m from investors.
The vehicle, which is expected to have a first close early next year and a final close in December 2022, will be structured as a European Long Term Investment Fund (Eltif) in order to ensure access to a broader group of investors.
The fund, which has already attracted seed investment of €30m, will be run by Marc Romano, who was hired in July as head of impact private equity funds.
‘We have a strong conviction to contribute to the change humanity is facing,’ Romano told. ‘Innovation is a core part of the solution and we want to contribute to companies that innovate with a positive impact on the environment.’
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The fund, which aims to invest between €5m to €20m in companies typically for a minority stake, will be targeting businesses that contribute to nine Sustainable Development Goals related to the environment, including water-related issues, climate change and the circular economy.
Romano said the strategy will allocate approximately 80% of its capital to companies in Europe in five key sectors including agritech and smart mobility.
The remainder of the capital will be dedicated to opportunities outside of Europe, mainly in North America and Israel, where there is a dynamic ecosystem of start-ups. Romano said he will be looking for businesses that are either already profitable or will be profitable in two to three years’ time.
The fund has already made two investments with another two in the pipeline.
‘We want the company to have a positive impact, but we also want companies that implement proper ESG standards,’ he added. ‘We expect the majority of our capital contribution to be used for capital increase with the purpose to accelerate the growth of the company and improve our impact contribution, and only some to be used to exit existing shareholders.’
Half of the team’s share of the profits from the fund, or carry, will be subject to achieving impact targets.
To ensure an independent assessment of this, Mirova will have an committee, made up of some of the fund’s limited partners and independent professionals. When an investment is exited, Romano said the impact will also be assessed by an independent third-party auditor.
Paris-headquartered Mirova has $28bn in assets under management and is a certified B Corporation.
Source: Citywire
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