Denham power fund targets 1GW with African platform

The private equity firm has teamed up with energy developer Themis to invest in natural gas-fired and renewable power generation assets across the continent.

Denham Capital has launched an African investment platform with developer Themis, targeting the development of gas and renewable power projects with more than 1GW of combined capacity through equity investments totalling $250 million.

The pair will incorporate a new company called Neo Themis in Morocco, with its first project, the 44MW Singrobo hydro project in Ivory Coast, expected to begin construction before the summer.

Denham said Themis is actively developing about 400MW across Africa and the pair have set a medium-term target of 1GW of both renewables and gas projects.

“Despite increased competition, the number of projects closing is still largely below the needs of the continent and this new venture is well positioned to fill the gap,” said Tas Anvaripour, chief executive of Neo Themis.

The investment by Denham was financed by the private equity firm’s International Power Fund, which is targeting commitments up to $1 billion, according to Infrastructure Investor data. The fund had raised $272.4 million as at November last year, according to an SEC filing.

The vehicle has secured commitments from both development finance institutions and institutional investors. Germany’s DEG Invest agreed in November to inject $40 million, while the European Investment Bank has been considering an undisclosed commitment since September. In addition, the San Francisco Employees’ Retirement System approved a $100 million investment in the fund in December, while earlier this month, the Montana Board of Investments injected $40 million.

Denham Capital already has three Africa-based power platforms in its portfolio following investments in Endeavor Energy, GreenWish Partners and BioTherm Energy since 2008. Denham also invests in oil and gas and mining. It currently has more than $9.3 billion of invested and committed capital across nine funds.