Business (IR)

EQUITA launches a new asset class to invest in renewable infrastructure through the “EQUITA Green Impact Fund”

21/06/2023

 

Milan, 21 June 2023 –  EQUITA, the leading independent Italian investment bank, announces the launch of a new asset class to invest in renewable infrastructure.

Growth in “green” investments is a well-known secular trend that has recently gathered support from an increasing commitment to act against climate change, focus on ESG and sustainability in general, and as a result of conflicts that have highlighted the need to ensure energy security.

Europe has committed to climate-neutrality by 2050, the first continent in the world to aim for such a target. Moreover, by 2030 Europe targets for 42.5% of the energy consumed to come from sustainable sources[1] and today approximately 36% of renewable technology patents are European[2]. Looking at Italy, the National Recovery and Resilience Plan (PNRR) has among its objectives the transition to renewable energy: the government plans to invest extensively, including more than €5 billion to support agrivoltaic technology, green initiatives to encourage the use of biomethane and the establishment of energy communities.

EQUITA's objective is to offer to institutional clients access to this trend by providing a platform to invest in renewable energy infrastructure initiatives. The new asset class will be managed by a team of experts - led by managing partners Balthazar Cazac, Ludovico Filotto and Nasir Nathoo – who have been managing infrastructure funds since 2011 and who joined EQUITA in 2023. The team will benefit from the complimentary skill sets of its professionals to efficiently manage the complexities of investment in renewable infrastructure, ranging from scouting and assessment of green projects to execution, financing and management of investments.

The team is already working on the launch of a new product – EQUITA Green Impact Fund ("EGIF") – and is in talks with a number of potential limited partners, including several possible anchor investors. EGIF will target renewables such as photovoltaic, wind and biogas (which are well-established and proven technologies), to optimize the risk-return profile of investments. The core market will be Italy, but the strategy will allow for diversification into other European countries such as Sweden, Denmark, Spain and Greece.

The new asset class - which benefits from a degree of predictability of cash flows, low correlation with traditional asset classes, and represents an interesting hedge against inflation – will allow EQUITA to further diversify its Alternative Asset Management offering and to increase the mix of illiquid assets under management, further enhancing its status as a multi-asset platform in Italy and Europe. The initiative will also consolidate the Group's expertise in the world of sustainability and green investments, being a part of the wider project announced by EQUITA in 2022 to promote sustainable finance by supporting investors, companies, entrepreneurs and institutions with new solutions and services dedicated to sustainability.

Matteo Ghilotti, CEO of EQUITA Capital SGR, commented: "Adding a fourth asset class will allow EQUITA Capital SGR to offer institutional investors an even more diversified set of investment solutions, increasingly focused on alternative assets. Funds like EGIF present long-term investment horizons and complexities which requires particular management skills. That is why we have decided to onboard a team of professionals like the EGIF team, who share our core values of partnership and entrepreneurship".

Balthazar Cazac, Ludovico Filotto and Nasir Nathoo, Managing Partners of EGIF, commented: “The Energy Transition is currently benefitting from a wave of political and financial support that provides exciting opportunities for investment in the renewables sector. We believe renewable infrastructure will allow investors to contribute to the mitigation of climate change, deploying their capital in a sustainable way and earning solid returns whilst diversifying risk.  Being part of a strong independent investment bank will allow us to combine our long experience in investing and managing infrastructure and renewables with Equita’s consolidated structure and top-quality network of institutional investors".

Andrea Vismara, CEO of the EQUITA Group, commented: "EQUITA continues its diversification and growth in the management of alternative assets with this initiative: it is an important, further step toward the achievement of the targets set in the three-year business plan EQUITA 2024. The fundraising of EGIF will start soon and it will add to the fundraising of the third private debt fund and the final closing of EQUITA Smart Capital – ELTIF, significantly increasing the weight of illiquid assets on total assets under management. Thanks to all of these initiatives EQUITA will diversify its investments geographically and, therefore, strengthen its presence in Europe".

 

[1] Source: Council and Parliament reach provisional deal on renewable energy directive - Consilium (europa.eu).

[2] Source: EU’s global leadership in renewables – Publications Office of the EU (europa.eu).