Actis, a leading growth markets investor, recently announced that it has reached the final close on its fourth energy fund Actis Energy 4 (“AE4”) with commitments hitting a hard cap at US$2.75 billion. The fund, which was raised by Actis’ in-house team, was significantly oversubscribed, exceeding its original $2 billion target size in just over seven months. The fund will invest in select countries in Latin America, Africa and Asia targeting control investments in electricity generation businesses offering scale, diversification and growth and market leading high growth electricity distribution businesses. AE4 already has an extremely strong pipeline with $2 billion of deal equity either completed or in late stage including four large scale regional platforms.
Demand for electricity and quality infrastructure in growth markets is high and rising. Energy services are crucial to a country’s economic development. An estimated $10 trillion of investment is required by 2035 across non-OECD markets to meet future demand. Since inception, Actis has raised cumulative commitments of over $5.6 billion and is committed to 30+ transactions in the Fund’s target markets. This fund closing follows a series of successful investment exits from previous funds, including GME (Latin America), Umeme (Uganda), Energuate (Guatemala) and Globeleq (Africa). To date, Actis portfolio companies have provided 68 million people with access to electricity and built 15GW of generating capacity.
Torbjorn Caesar, senior partner at Actis, said: “The Actis Energy Team combines a strong operational focus and deep industry experience with finance and energy investment skills in growth markets. Many of the senior Energy Team partners and directors have been executive managers of the same types of businesses that Actis invests in and have an in depth understanding of the full value chain and value creation. This has been the key to our success in previous funds and will be integral to realising the pipeline of opportunities for Actis Energy 4.” Actis’ Energy team is a proven group of more than 30 investment professionals with extensive investment expertise and industrial skills in growth markets. Actis has also bolstered the team in recent months, bringing on senior professionals with extensive growth markets experience, including Barry Lynch, Lisa Pinsley and Javier Areitio.
Mikael Karlsson, partner and co-head of the energy business at Actis, said: “As the leading growth market investor in the energy sector we have never seen a more compelling market opportunity. The demand for new investment within the electricity sector is $1.5 billion every day with renewable energy generating $0.5 billion of investments per day in non-OECD countries. We are delighted that our investors share our vision for this opportunity and we are grateful to them for placing their trust in our proposition.” Neil Brown, partner and head of the Investor Development Group at Actis, said: “This fundraise was achieved very swiftly. We went to market in July and the appetite from existing investors to back the compelling market opportunity, track record of the management team and pipeline we presented. The success and speed of this is a testament to the strength of the relationships we have built as a general partner with our investor base.”
Actis is a leading investor in growth markets, delivering consistent competitive returns, responsibly. It has a growing portfolio of investments across Asia, Africa and Latin America and has raised over $12 billion since inception. The firm invests through insights gained from trusted relationships and local knowledge, deep sector expertise and an unparalleled heritage, set within a culture of active ownership. Applying developed market disciplines to growth markets, an established team of c. 100 investment professionals in ten countries identify investment opportunities in response to two trends: rising domestic consumption and the need for sustained investment in infrastructure across private equity, energy and real estate asset classes.
Actis is a signatory to the United Nations backed Principles for Responsible Investment (UNPRI), an investor initiative developed by the UNEP FI and the UN Global Compact. Actis targets consistent superior returns across asset classes over the long-term, bringing financial and social benefits to investors, consumers and communities. It calls this the positive power of capital.