Macquarie eyes $400m for second cleantech FoF

The fund’s official target is $600m, but its GPs are shooting for a more modest $400m in the current environment. The group's first cleantech fund of funds closed on $200m in 2007.

The Macquarie Funds Group is planning to raise $400 million for its second cleantech fund-of-funds, according to a person familiar with the matter.

The fund’s official target is $600 million, but the team has lowered expectations given the current tough fundraising environment, the person said.

Carlsbad, California-based Rick Fratus is heading the fund, where the US team is based. The rest of the team is based in London.

The fund will invest in funds focused on clean technologies such as solar, ethanol, wind, geothermal and biomass energy. It will have a mandate to invest in secondary transactions and to make co-investments.

Macquarie launched its first cleantech fund of funds in December 2006 and closed on $200 million the following year. That fund was invested in funds of funds such as Rockport Capital II, Hudson Clean Energy Partners and Carlyle/Riverstone Renewable Power Partners.  Its performance has been in excess of a 30 percent internal rate of return.

The Macquarie Funds Group was created last year to house Macquarie’s funds and funds-based structured product businesses under one roof. That division, which is separate from Macquarie Capital Funds, was created in June 2008 and is headed by Shemara Wikramanayake, formerly the head of Macquarie Capital Funds in North America.