6th February, 2024
A coalition of state-owned investors from across the world has thrown its weight behind Generate Capital in a US$1.5 billion fundraise, which boosted the sustainable infrastructure frontrunner’s funding for new projects and technologies. Existing state-owned investors from Australia, QIC and Australian Super, boosted their existing investments, while new investors included the California State Teachers' Retirement System (CalSTRS) and Australia’s HESTA. The fundraise brings the total raised since 2014 to US$10 billion. It is not unusual for Australian pension funds to co-invest, as well as draw in peers from other countries. The renewables and sustainability sector is notable in seeing a high level of convergence of state-owned investors (SOIs) in transactions. Generate Capital claimed it produced over 320GWh of sustainable power by September 2023. It is heavily concentrated in the US, particularly California, which may have drawn CalSTRS’s interest. Yet, the significant weight of Australian SOIs, acting together, suggests a potential domestic interest. Australia’s green hydrogen sector has already attracted billions of SOI capital and Generate Capital could focus increasingly on Australia’s resources. However, its ethos chimes well with the long-term objectives of a large section of the SOI universe and the platform could see other heavyweight investors pile capital into its projects. Alliances in green energy have been led by Singapore’s GIC while its sister organization Temasek focused on start-ups with new technology to advance renewables, batteries and low carbon industrial processes. Gulf funds also focused both on strategic investment in domestic renewables capacities and on yield-generating assets abroad, with Mubadala leading the way through the Masdar platform as well as directly. The interest in green hydrogen is high, as it could provide the feedstock for ammonia and methanol production and revive the chemicals chain, while being de-linked from the oil and gas sectors. GIC backed a major green ammonia plant in India, partnered with co-investors in Australia’s hydrogen sector, snapped up a stake in InterContinental Energy, and joined Copenhagen Infrastructure Partners in backing a green bond issue by TagEnergy of up to US$ 0.6 billion to fund renewables and battery storage in Australia, the UK and Europe. Bio-based fuels also drew interest, with OTPP committing US$ 0.3 billion to a JV with Sevana Bioenergy to develop renewable natural gas projects utilizing organic waste; and Mubadala’s Acelen using its Mataripe refinery site in Brazil as host to an innovative US$ 2.5 billion push into cleaner aviation fuel from oils derived from soybean, palm and macauba oils. Instead of simply divesting carbon intensive assets, Canadian PPFs have looked to greening them. CPP partnered with IKAV to acquire Aera Energy, which represents 25% of California’s oil and gas production with a view to expanding its renewable energy portfolio. All in all, Sovereign Investors invested, once again, more in the so-called green assets than in the so-called black assets in 2023, reaching a historical maximum of US$ 26.1 billion in the support to companies related to the energy transition, including renewable energy, battery storage and electric vehicles. Gulf SWFs were responsible for almost half of that figure, and are pushing the energy transition agenda and recycling revenues from black assets into green impact investments, particularly in their own backyards. Canadian, European, Singaporean, and Australian funds are also freeing up plenty of dry powder to plunge capital into achieving their net zero ambitions, with the rest of the funds set to join them in co-investments.
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5th December, 2022
Australian super fund HESTA has boosted its AUM to nearly A$70 billion (US$57 billion) with more than 970,000 members following its merger with the smaller, 60-year-old Brisbane-based Mercy Super fund, which has 13,000 members.
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22nd April, 2022
The Abu Dhabi Investment Authority (ADIA) and Australia’s healthcare sector superannuation fund HESTA have joined a consortium led by US private equity firm KKR that is seeking to buy Australia-based global hospital operator Ramsay Health Care for A$20 billion (US$15 billion) - a move that proves Australia is an enduring attraction for both domestic and foreign state-owned investors (SOIs).
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8th March, 2022
Today is International Women’s Day and, once again, we have studied in detail the female representation at State-Owned Investors, including SWFs and PPFs. Diversity and inclusion are becoming key parameters in ESG reporting, and funds are putting a lot of effort in recruiting and retaining people of all genders, races and backgrounds. We observe large disparities in the composition of the workforce of the world’s major SOIs
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