Fullerton Fund Management Raises US$100 Million For Carbon Action Fund

Singapore-based Fullerton Fund Management (Fullerton) has successfully raised US$100 million in the anchor close of its Fullerton Carbon Action Fund.

The fund manager said the private equity fund captures the enormous climate market opportunity in emerging Asia by investing in companies at the forefront of accelerating decarbonisation in the region.

Asia accounts for over 50% of the world’s carbon emissions and represents a US$5 trillion climate investment opportunity by 20301.

The region’s climate sector is well-positioned for long-term growth driven by fundamentals that are critical in the world’s transition to net zero. The acceleration of local and global climate regulations, also serve as strong tailwinds for the sector.

Within Asia, there is a clear impetus and focus to actively pursue decarbonisation outcomes, and countries have announced their carbon neutrality timetable as proof of their commitment – China 2060, Singapore 2050, Indonesia 2060 and India 2070.

The Fund will invest in market leading businesses in the rapidly growing manufacturing, industrials, energy, and electric vehicles/mobility sectors. It will seek established, profitable and robust cash flow businesses, and avoid earlier stage venture capital investments as well as infrastructure related deals.

These target companies have lower inherent downside risks and are well-positioned to deliver attractive financial returns over the long-term.

“With the acceleration of the decarbonisation roadmap in Asia, we are at an inflexion point where the fight against climate change coincides with the emergence of very compelling growth areas in private equity. This strategy provides an avenue to ride the decarbonisation wave and advance the net zero agenda in the region, while capturing long-term opportunities,” said Jenny Sofian, Chief Executive Officer, Fullerton Fund Management.

Focusing on leaders in the mid-market space in Southeast Asia, India and China, the Fund provides strategic support alongside capital to drive the growth of its portfolio companies in areas such as new market entry, M&A and sustainability improvements.

Backed by a strong pipeline of proprietary deals, the Fund is currently evaluating several investment opportunities across Asia, with the target to close at least three transactions by the first half of 2024.

The Fund is managed by Fullerton’s seasoned Alternatives team, who have an average of 16 years industry experience. The investment approach is underpinned by a proprietary sustainability management framework that seeks to drive significant decarbonisation outcomes in portfolio companies.

Seviora Group, a Singapore-based asset management group wholly owned by Temasek Holdings, and Income Insurance Limited, one of Singapore’s leading insurers, are the anchor investors for this strategy. As shareholders of Fullerton, Seviora and Income Insurance are committed to supporting investment strategies that can help to address climate change while seeking to deliver attractive risk-adjusted returns for investors.