Maybank sees SE Asia cleantech potential

The Maybank MEACP Clean Master Energy Fund and its accompanying co-financing vehicle announced that they have so far raised $145 million and are on course to reach $500 million by July 2012. Unlike most of their counterparts in the cleantech arena, the bulk of the capital will target companies in Indonesia, Malaysia, Thailand, the Philippines and Vietnam.

MEACP Managing Director Ali Khan says that investors have historically favored China and India because of their significant investment opportunities and the relative smallness of the economies of Southeast Asian nations.

Today, however, he says there is "tremendous opportunity in power generation from clean and renewable sources", partly due to the favorable regulatory environment in these countries, including so-called tax holidays. The Philippines, for example, is due to bring in feed-in tariffs which will mean that all energy generated by renewable means will be purchased by the government.

While some might express concern at the idea of launching such a sizeable fund for this sector, Khan notes that if it were any smaller the likes of the Asian Development Bank and the International Finance Corp. would not have been able to participate. "It also allows us to make investments which smaller funds by default could only consider by co-investment," he adds.

The Singapore-based fund, which is being raised with the help of placement agent Boyd & Co., is styled as a vehicle that invests in "power generation from renewable sources" rather than a cleantech fund per se. It features a clawback provision as well as a management fee of 1.5%, a 20% carry (paid on a deal-by-deal basis) and a hurdle of 8%. Maybank itself has contributed $50 million.

The fund is yet to make its first investment, but is already considering a number of possibilities, including a biomass project in the Philippines. Though focused principally on power generation and infrastructure, the fund will not dismiss deals in the manufacturing or technology arenas - particularly, perhaps, because it intends to make 15-25 investments per year. Each of these will involve equity tickets of $10-$30 million, and any exit proceeds will be reinvested into the vehicle, provided the fund's target IRR of 20% is being achieved.

Although Clean Master Energy constitutes the first fund under MEACP's management, the vehicle will be managed by CEO Mumtaz Khan, who boasts in excess of 30 years of experience in private equity and project finance. Khan was previously responsible for the Islamic Development Bank's $730m Global Infrastructure Fund and the AIG Infrastructure Fund.

The fund will be co-managed by Mayban Ventures, whose previous vehicles include the $40 million Mayban-JAIC ASEAN fund.

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• Topics
• Cleantech
• Fundraising
• Southeast Asia
• Cleantech
• Fundraising
• Southeast Asia
• Maybank