Deals

South African renewables fund eyes 600MW after first deployment

Evolution II’s maiden deal comes ahead of an expected $250m final close September this year.

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South African fund manager Inspired Evolution has made the first investment from its renewable energy fund Evolution II, eyeing a portfolio of over 600MW.

The fund has invested $36 million into Alten RE Developments Africa, a solar-focused subsidiary of Netherlands-based developer Alten Renewable Energy. The move will see Evolution II become an investor in three projects at an advanced stage of development, including one of Africa’s largest solar plants.

The 125MW Middle Band Solar One project being developed by Alten in Nigeria has a signed power purchase agreement and is edging towards a financial close. The firm’s 45.4MW project in Namibia is expected to reach a close this month, while its 51.5 Kesses 1 site in Kenya is slated for financial close in May.

Inspired Evolution also said an additional 400MW of pipeline projects are being worked on by Alten across Sub-Saharan Africa, currently at various stages of construction-ready, advanced and pre-permitted.

“[Alten] has a strong track record in southern Europe and more recently in Africa and Latin America, where it has won projects in fiercely contested public-private auction environments,” Inspired Evolution stated.

The maiden investment from Evolution II comes ahead of a $250 million final close for the fund, expected in September later this year after a scheduled $125 million second close next month. The fund’s $90 million first close in December 2016 was led by Africa-focused infrastructure investment platform Quantum Power, with other investors including fund of funds, DFIs and family offices. The latest commitment came at the tail-end of last year with a $20 million backing from the African Development Bank.

Evolution II is a follow-on vehicle to its $90 million predecessor, which launched in 2008. The fund invested in a series of resource efficiency and renewable energy companies and projects, with three exits planned for this year following the sale of stakes in projects comprising 300MW last year. The company said at the time Evolution One was “one of the stand-out performers” of 2008-vintage funds investing in renewables, although it declined to state a figure for this.