Mirova, the affiliate of Natixis Investment Managers dedicated to sustainable investment, supported by Mirova SunFunder East Africa Ltd as Investment Advisor, a wholly owned subsidiary based in Nairobi, announced that the Mirova Gigaton Investment Vehicle has raised USD 171 million for its first closing.
The blended finance debt strategy aims to accelerate the clean energy transition in underserved and emerging markets in developing countries, with a strong focus on Sub-Saharan Africa.
NDF is a key partner of the Mirova Gigaton Investment Vehicle, by investing USD 15 million out of the Fund’s current total of USD 171 million. The Vehicle primarily aims to deploy finances to small and medium-sized enterprises (SMEs).
The funding will be invested in solar home systems, climate-smart food systems, energy efficiency and carbon credit pre-financing, while offsetting CO2 emissions, creating decent jobs, advancing gender equality, and improving energy access for all.
“At NDF, we are committed to create more pathways and opportunities for much needed blended finance solutions for climate change adaptation and mitigation in lower income countries. The Mirova Gigaton Investment Vehicle is an excellent example of the importance of bringing together the expertise and finances of the public and private sectors to increase energy access, clean energy transition and climate investments in underserved and emerging markets. We are proud to be co-investors alongside other partners and maximize the positive impacts of this initiative. This is especially crucial in Sub-Saharan Africa, where the impacts of climate change are significant,” said Henrik Franklin, Director of Portfolio Origination and Management of NDF.
The fund’s target size is USD 500 million and expects to deploy USD 1.2 billion of private debt throughout its life primarily to small and medium-sized enterprises (SMEs) in solar home systems, agri-solar, commercial & industrial solar, telecom tower solarization, mini-grids and other promising sectors such as e-mobility, battery storage, climate-smart food systems, energy efficiency and carbon credit pre-financing. Classified “Article 9” under the framework of the new European SFDR[2], the fund aims to impact peoples’ lives by offsetting CO2 emissions (SDG 7, SDG 13), creating jobs (SDG 8), advancing gender equality (SDG 5) and improving energy access (SDG 7, SDG 8, SDG 5).
Long-standing partners such as U.S. International Development Finance Corporation (DFC), Swedfund and Sida as well as new investors will provide the catalytic capital and guarantee that help decrease risks and consequently unlock private capital. Natixis Private Equity also invested in the fund to further mobilize private investors, combining investors’ resources to truly scale clean-energy investments, with robust social, gender and economic impacts.
The fund already constituted a pipeline of investments in over 30 countries and continues to actively seek new investable opportunities that further the efforts to build a sustainable and low carbon future.
”Today, more than 770 million people lack energy access in the world – mostly in Africa and developing Asia – regions with populations that are also the most vulnerable to the global climate crisis. Addressing climate change requires a reallocation of capital to decarbonizing global economies, particularly a clean energy transition in emerging markets. The Mirova Gigaton Fund will provide medium-long debt financing for clean energy projects and companies, accelerating the transition to a low-carbon economy and improving energy access in Africa, Asia Pacific & Latin America. We are grateful for all of the Mirova Gigaton Fund investors for their support and partnership.” : Said RYAN LEVINSON Director of the Mirova Gigaton Fund, Head of Emerging Market Energy Transition
”As a mission-driven, global responsible investor, we are aware that a large portion of the rise in global power demand will be driven by expanding non-OECD economies. As we have seen growing interest from investors for long-term investments in tangible assets and attractive yield potential, we are confident that the Mirova Gigaton Fund constitutes an interesting opportunity to finance the energy transition around the globe, relying notably on Mirova SunFunder’s expertise and know-how in emerging markets.” :concluded RAPHAËL LANCE, Head of Energy Transition Funds
