CDC anchors Global Environment Fund spin-out
UK development finance institution CDC Group has anchored a $130 million first close for a fund managed by a South Asian spin-out of US-based Global Environmental Fund Capital Advisors.
CDC has committed $25 million to India-based GEF South Asia Advisors’ second growth fund known as SAGF. It comes within weeks of CDC confirming a contribution of $15 million to a $97 million fund from Omnivore Partners, a VC firm focused on impact investments in the Indian agriculture industry. CDC is the largest investor in both funds.
“Both funds are mandated to invest in local SMEs [small to medium-sized enterprises] that innovatively tackle key environmental and social challenges in Asia,” Alagappan Murugappa, a managing director and head of South Asia intermediated equity at CDC, said in a statement. “Direct access to water, food and clean energy are the pillars on which to build strong and healthy communities.”
SAGF positions itself as the only private equity fund that supports SMEs operating in the underserved resource efficiency market. The fund aims to invest businesses that address cleaner and more efficient production and usage of energy, water and food. India will be the primary focus, but opportunities will also be considered in Bangladesh, where the private market is less developed and capital is scarce.
CDC is an active investor in South Asia, where its strategy includes both fund commitments and direct investments. Other recent activity includes a $40 million contribution to a $150 million round for Indian online grocer BigBasket, and a $15 million investment in Nepal’s NMB Bank. The firm also invested in Lighthouse Funds’ third India-focused growth fund, which closed earlier this month at $230 million.
Last year, CDC announced it would invest $1.7 billion over the next three years in South Asia, including Myanmar. This coincided with a $10 million commitment to Anthem Asia’s recently launched Myanmar fund and the nomination of Stephen Priestley as a managing director with a focus on South Asia and Africa.
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