Mirova launches debut impact fund with EUR 300m target

Harriet Matthews
30 September 2021

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Natixis subsidiary Mirova has announced the launch of its first impact fund, Mirova Environment Acceleration Capital Fund, which has a EUR 300m target.

The firm has previously raised funds for institutional investors focused on energy transition, natural capital project financing, and social and solidarity businesses.

Mirova Environment Acceleration Capital Fund will invest in European companies providing innovative, sustainable technologies and services that contribute to the environmental transition, Mirova said in a statement.

"We had a first technical close on 1 August with EUR 30m in seed capital from Natixis, and we expect to have our first client close in early Q1 2022," Marc Romano, head of private equity impact at Mirova, told Unquote.

The fund expects to hold a final close in Q4 2022, Romano added.

Mirova hired Romano in July 2021 to launch its impact strategy. He will head a team comprising five people, according to a statement. Romano has prior experience in impact investing and asset management at Schroders and Rothschild & Co.

Alongside the official launch of the fundraising process, Mirova simultaneously announced its first investment from the fund, backing France-based Ombrea, a company that produces photovoltaic panels and systems designed to manage and protect crops against climate hazards.

The firm is targeting gross returns of 2.5x money and 20% IRR, or 2x money and 15% net IRR on the institutional share classes, Romano added.

Investors
The fund's LP base is expected to be made up of institutional and private investors, with existing LPs also expected to participate, Romano told Unquote. "In terms of type of institution, we expect to have a broad range of institutional investors: pension funds, insurance companies, banks and funds-of-funds," Romano said. "In terms of geography, European investors will dominate, even if we have strong interest expressed from North America and Japan."

Investments
The fund will invest on a pan-European basis, targeting companies that are profitable or almost profitable with a proven business model. The businesses of these companies must address at least one UN Sustainable Development Goal, according to a statement.

Investments from the fund will focus on five sectors: smart cities, natural resources, agricultural technologies, the circular economy and clean energy.

The vehicle will make investments where the majority of the proceeds will be used for a capital increase to support a company's growth, the GP said in a statement. The fund will deploy equity tickets of EUR 5m-25m and expects to make 20-25 platform investment, Romano told Unquote.

People
Mirova – Marc Romano (head of private equity impact).