CLSA Capital Partners, the private equity arm of CLSA, an Asian brokerage house and investment bank founded in 1986, has launched its fifth fund with an initial $11 million commitment from CLSA and the fund’s principals to invest in Asia’s non-carbon energy sector.
The Clean Resources Asia fund is a hybrid fund – hedge fund and private equity – launched by CLSA Capital Partners, said Andrew Pidden, one of the fund’s principals.
CLSA aims to raise up to $200 million for the fund, but the managers are currently more concerned about establishing a track record in what Pidden calls an “emerging sector”.
Pidden will be managing the fund together with Anthony Wilkinson, who is also head of research at CLSA, from Singapore.
“A side pocket of the fund is reserved for private equity,” Pidden said, adding that up to 20 percent of the fund will be invested in private equity deals.
The fund will focus on investing in companies that offer technological solutions to growing environmental challenges. Equity stakes in listed companies and fast-growing companies that are potential takeover targets are also on the fund’s radar.
Wilkinson said: “Government policies across the region are already recognising the role of clean energy which encompasses cleaner coal, biofuel substitutes, natural gas, wind, nuclear energy and micro-generation.”
In a statement, CLSA referred to a report by China’s official news agency Xinhua, indicating plans by the Chinese government to spend $42 billion from 2005 to 2010 to cut power plant emissions, treat sewage and improve waster management.
This hybrid fund will shortly be followed by CLSA Capital’s launch of an interregional transport and logistic-theme fund.
In addition to the energy fund, CLSA Capital Partners already manages four other funds, each with a different theme: Aria focuses on providing growth capital for companies exposed to rising domestic demand in Asia; Fudo Capital on Asian property; Sunrise Capital on growth and mid-market buyouts in Japan; and MezzAsia, on mezzanine debt financing for LBOs in Asia.