Netherlands-based Climate Fund Managers raised three billion rands ($182 million) for Climate Investor Three, which makes equity investments in green hydrogen and industrial decarbonization projects in Southern Africa.
New backers of the fund include insurance company Sanlam Life and the Industrial Development Corporation of South Africa, European Commission via the Global Gateway strategy, Invest International. South Africa’s Public Investment Corporation which manages the Government Employees Pension Fund, also participated.
The blended finance fund, which was launched early last year with €150 million in commitments from European donors, aims to raise 12 billion rands, or more than $700 million, by mid-2028. Climate Investor Three is one of five funds by Climate Fund Managers with different mandates covering climate infrastructure in Asia and Latin America, and Africa-focused funds backing renewable energy and oceans, water and waste management. The firm secured $86 million last year for its water access project in South Africa.
Pension appetite
For PIC, the investment is its latest foray into private market alternatives; it has been one of the few pension fund managers actively investing outside of government notes. PIC invests in private equity funds across West and Southern Africa and is a strong backer of Black South African managers to counter historic wealth allocations in the country. PIC earlier this year backed Hlayisani Capital in a $30 million first close for the manager’s second fund.
Sifiso Sibuya of the Government Employees Pension Fund says asset and investment managers should package funds in a way that’s most appealing for pension funds bound by fiduciary duties.
“We can’t only invest in one asset class,” he told ImpactAlpha. “There’s a need for diversification, and if you can achieve the same or more returns from other asset classes, there’s merit in considering them in the investment strategy.” (See, “This regulatory reform could unlock African pension capital for impact fund managers”).
