Macquarie’s GIG eyes open-end approach for new fund – exclusive

The GIG Energy Climate Opportunities vehicle is set to launch early next year, with an initial closing later in 2023.

Macquarie Asset Management is gearing up to launch its latest fund under the Green Investment Group umbrella, although the new offering will differ by having an open-end structure.

Sources have told Infrastructure Investor that GIG is preparing to launch Macquarie GIG Energy Climate Opportunities fund early next year. An initial close is understood to be targeted for later in the year.

It is understood that the MGECO vehicle will target more mature renewable energy assets at the lower end of the risk spectrum. It is thought of as a successor to Macquarie Green Investment Group Renewable Energy Fund 2, which closed on €1.6 billion in February 2021.

That was structured as a 25-year vehicle and typically looks to manage projects from construction and through their operational phase. One of its most recent investments came in June through a joint venture to build and operate Feijão, a 586MW combined wind and solar power project in the northeast of Brazil.

MGREF1 is also a 25-year fund and was raised when the GIG was still known as the Green Investment Bank and under the ownership of the UK government. It closed on £1.1 billion ($1.3 billion; €1.3 billion) in January 2017 and remains the world’s only dedicated offshore wind fund.

MGECO would be the third GIG fund launched under Macquarie ownership. In September, Infrastructure Investor reported that the GIG had launched Macquarie GIG Energy Transition Solutions, a fund targeting $2 billion that will go beyond wind and solar and towards the earlier stage investments in the energy transition spectrum. The vehicle is targeting a net IRR of 13-15 percent.

“The team will be looking at how we can identify and deploy capital, both for our established funds as well as evaluating new opportunities that might have a different risk-return profile,” Ben Way, group head of MAM, told us in an interview in June.

Macquarie declined to comment on the fundraising.