Exclusive: Dragon Capital boosts target for second fund

The Vietnamese firm’s maiden renewables offering, a $40m vehicle focused on Southeast Asia, is now fully deployed.

Dragon Capital is boosting its fundraising ambitions as it launches a second fund dedicated to Southeast Asian renewables, according to a top executive at the Vietnam-based firm.

Gavin Smith, director of clean development at Dragon Capital, told Infrastructure Investor that it was seeking to collect $100 million from international institutions this time round, more than twice the total it garnered for the fund’s predecessor.

Mekong Brahmaputra Clean Development Fund (MBCDF), Dragon Capital’s maiden renewables offering, reached its final close in 2010 on $40 million.

MBCDF covers sectors including renewable energy, energy efficiency, water and waste treatment. Now fully deployed, it is invested in projects of between $1 million and $7 million in Vietnam, Thailand, Lao, Cambodia, Philippines, Bangladesh and Sri Lanka.

Investors in MBCDF include the Asian Development Bank, FMO, Finnfund and the Belgian Investment Company for Developing Countries, according to Infrastructure Investor Research & Analytics.

Smith believes clean energy deal flow in the region will remain strong as markets revamp their regulatory and financing frameworks in a bid to encourage private investment. He also reckons the COP21 agreement signed in Paris last month is prompting governments to try and match rising energy demand with fresh renewable generation capacity.

Projects backed by MBCDF last year include an 8.1-megawatt (MW) run-of-river plant in central Vietnam and a 29MW grid-connected solar plant in Thailand, the latter through an expanded investment in venture capital firm Symbior Energy.

Established in 1994, Dragon Capital manages assets worth about $1.4 billion, according to its website. It has offices in Ho Chi Minh City, Hanoi, Bangkok, Hong Kong and the UK.