Aditya Birla Group along with Lotus Renewables is set to launch a $100 million Global Clean Energy Fund targeted at developing countries in Asia, including India, as well as Australia. “Currently we are looking Asia and Australia as a market to start with .
We have identified markets like India , Srilanka , Australia , Indonesia , Thailand , Philippines , Vietnam etc,” K Gowri Shankar, Director, Lotus Renewables told DEALSTREETASIA.
The Global Clean Energy Fund, which will be managed by Singapore-based Aditya Birla Sun Life Asset Management Company Pte Ltd, will invest in assets that generate clean energy. It will provide debt and equity financing to small and medium-sized clean energy projects across the globe.
The fund will typically work on a pipeline of projects seeking investment pre-construction in sectors such as small hydro, solar, wind, biomass, geothermal, energy storage and smart grids. It will also look at investing in distressed assets that suit its portfolio profile.
The vehicle will have strategic partners in the regions they are targeting. “We will appoint an independent local consultants for doing due- diligence before our investment committee’s evaluation,” said Shankar
The fund is expected to make its first close at $30 million in the next two months with the target of closing the $100 million fund by the end of December, he added.
Lotus Renewable Energy Group is a multinational renewable energy company with its operations across India, Sri Lanka, Singapore and Australia. It provides Solar photovoltaic solutions and also owns and runs mini Hydro power plants.
The company will be putting an initial investment of $5 million, said Shankar. “We are targeting clean energy assets that can generate long term consistent return. We are targeting $ return of above 8 %,” he added.
With governments turning their focus to renewable energy, the sector has also caught the fancy of investors.
It was recently reported that CDC Group Plc, the UK government’s development finance institution, is planning to set up its own renewable energy platform focussed on east India and neighbouring countries.
Last year, Australia also announced the launch of the AU$20 million ($15 million) Clean Energy Seed Fund (CESF), which will provide seed and angel funding to ventures developing clean energy solutions.
In India, Asset management firm IDFC Alternatives Ltd announced in September last year to float a separate platform to hold its renewable energy assets.
“As we are looking small and medium scaled project which are not concentrated by large renewable players. The fund will have an attractive return and we feel this will de-risk the portfolio by diversification,” said Shankar.