SUSI drops JV with South Pole Group in Asia, creates its own team in Singapore

The new office will launch and manage the Asia Energy Transition Fund, focused on investments in Southeast Asian countries.

Swiss energy-transition manager SUSI Partners has dropped its joint venture with financier The South Pole Group to raise a Southeast Asia-focused fund, and is instead creating its own Singapore-based team to pursue the strategy alone, a senior executive told Infrastructure Investor.

“For SUSI, it was motivated by a rethinking in the execution plan,” Wymen Chan, managing director of SUSI’s Asia team, said. “We have now hired our own team, with the right people on the ground in Asia, and we will be able to execute this strategy on our own going forward.”

Chan said that, since his appointment in September, he has formed a team of five people based in Singapore, and is looking to increase the headcount to seven in the next six months, to fill positions in the asset management and investment teams.

SUSI and The South Pole Group announced in 2017 a joint venture to launch a vehicle named “Asia Energy Transition Fund” and focused on renewable and energy efficiency projects in Southeast Asia.

Edgare Kerkwijk, the former head of the Asia team, left the firm in August, and the vehicle was never launched, SUSI says.

The firm declined to give more details about the JV dissolution, but it said in a statement that, after the partnership fell apart, SUSI “decided to start with a clean slate and rebuild the team from the ground up”.

The South Pole Group confirmed to Infrastructure Investor that the firm “is not involved in the fund management” of the new strategy.

SUSI is now expecting to receive its Singaporean fund management licence during the first quarter of 2019, in order to start the fundraising process.

The new vehicle, which will keep the same name, is aiming to raise $250 million to invest in a portfolio of 20 to 25 renewable energy and energy efficiency projects in Southeast Asian countries, Chan said. Returns are expected to range from 11 to 14 percent on a hold-to-maturity basis, he said.

“Energy efficiency projects have a risk-return profile that is different from renewable energy projects. They tend to be lower risk and therefore accretive to the portfolio from a risk-return perspective,” Chan said.

According to SUSI’s head of Asia, the asset manager will be engaged with all stakeholders “from an early stage”, including banks, communities, developers, utility companies and local and regional governments, in order to shape projects “so that they are compliant, bankable and ultimately divestable with an attractive return.”

“In Southeast Asia, governments and regulators are accessible to investors like us, and it is our hope to shape future policies to make the sector more bankable,” he said.

Similarly, Chan stressed that early engagement with developers is aimed at avoiding “mistakes that can’t be remedied,” such as issues related to land acquisition.

The firm will aim to raise funds from development financial institutions, multilateral organisations, as well as institutional investors, Asian corporations and family offices.

Wymen Chan joined the firm after holding senior investment management roles at Armstrong Asset Management and Maybank MEACP, focused on the renewable and clean-tech sectors in Southeast Asia.

SUSI Partners is a Swiss investment house with 10 years of experience in the renewable and energy efficiency space, with a total AUM of €750 million, according to Infrastructure Investor data. The asset manager closed the world’s first energy storage fund on €252 million in June, and it was aiming to hold a first close for its second energy efficiency investment before the end of the year.